Trade Secretary Liz Truss has attempted to reassure Welsh sheep farmers about the prospect of a UK-New Zealand trade deal.
Industry bodies have repeatedly warned an agreement with New Zealand could undermine the UK’s domestic sheep market.
But Ms Truss told attendees of NFU Cymru’s conference last week that New Zealand was not taking full advantage of its current ability to export sheepmeat to the UK.
“New Zealand already has quota to export into the EU, and we are part of that through the transition period,” she said.
“New Zealand is not actually using up all its quota, because there are higher prices available in the Asian markets.
“We will be very careful to make sure such deals do not have a detrimental impact, but I would reassure farmers that even though New Zealand has ability to export to us at the moment, they are simply not doing it because of the growing demand in Asian markets for high-quality protein.”
National Sheep Association (NSA) chief executive Phil Stocker, however, remained unconvinced.
He said: “The question remains, with New Zealand – and Australia – only partly filling their EU quota to the UK, why would they fight so hard for something they do not want?
“Liz Truss’s comments are only a part answer. Of course for as long as global prices mean it works for New Zealand to supply growing Asian markets then that is what they will do.
“But ours is a very sensitive industry with a finely balanced sheepmeat market and we need the security of knowing in the event of any global market disruption, which could be caused by climate incidents or political unrest, we will not end up with our markets being flooded, dragging prices down.
“That would do nothing to deliver the Government’s ambition of the highest production standards in the world.”
Ms Truss also repeated her earlier warning that it is ‘dangerous’ for the UK sheep sector to be so reliant on the EU market for exports.
She claimed opening up the Japanese market for UK lamb would benefit Welsh producers, with the size of the opportunity estimated to be £52m over five years.
When the deal is ratified by Parliament, the Government will begin a promotional campaign for a range of UK food products, including Welsh lamb.