The agri-food sector is of critical importance to the Irish economy, and its regional spread means it underpins the socio-economic development of rural areas in particular. Brexit has the potential to have a very significant impact on the sector, given its unique exposure to the UK market, which accounted for 38% (€5.2 billion) of agri-food exports last year.
There are on-going discussions with the Commission regarding the difficulties which would face Ireland in the event of a no-deal Brexit, and the assistance that might be required for its agriculture food and fishery sectors. Avoiding a no-deal Brexit continues to be the Government’s overriding policy priority.
It is clear that, in the event of a no-deal Brexit, the impact of the UK tariff regime as announced would have had a significant impact on beef prices and on beef farm incomes, as a result.
I have held a number of discussions with Commissioner Hogan regarding the potential impact of a disorderly Brexit on the sector. I have stressed the need for the Commission to be ready to deploy a range of measures to mitigate the potential impacts on agri-food and fisheries, including through traditional market supports and exceptional aid under the CAP's Single Common Market Organisation regulation (Regulation (EU) No 1308/2013), as well increased flexibility under State Aid regulations.
Obviously, as Minister, I have no role when it comes to prices paid to producers but it is important to acknowledge that the past few months have been very difficult for beef farmers in particular, following a difficult year in 2018 due to weather conditions. There has been a period of depressed prices since last autumn with the ongoing uncertainty surrounding the outcome of Brexit, among other factors, contributing to this market disturbance. I also note that prices have started to increase week-on-week recently, mainly due to tightening supply of cattle and the outlook is that this will continue. Market intelligence also points towards other factors such as the presence of African Swine Fever in China affecting their pork output, thereby strengthening the demand for beef in a market to which Ireland already has access.
In light of the on-going market disturbance, I have, in discussions with Commissioner Hogan and my EU counterparts, said that I believe that the deployment of exceptional measures under the CMO Regulation, to provide targeted aid to farm families who have suffered a sustained reduction in returns from the market, is now required. I made an intervention to this effect at the April meeting of the Council of Agriculture Ministers, and my officials have followed this up with a detailed submission, which is under consideration by Commission officials.
One of the unique strengths of the agri-food sector has been the shared vision for the sustainable development of the sector in Food Wise 2025. It is crucial that we all continue to work together. I have highlighted the need for stakeholders to recognise their inter-dependency, and to increase the strength of all links in the supply chain, including the development of Beef Producer Organisations.
I am deeply committed to fully supporting and developing Ireland’s beef sector. I am strongly of the view that the existing range of supports available to beef farmers under the RDP, together with ensuring access to as many markets as possible, both for live animals and beef exports, are appropriate for the continued development of the sector.