Farmers hardly got a mention in European Commission President Jean-Claude Juncker’s State of the Union address.
But they have emerged as the most vehement opponents of his stated priority in the speech to strengthen the European trade agenda.
He said every additional €1 billion in exports supports 14,000 extra jobs in Europe.
With a Canada trade agreement secured and provisionally applying already, and an agreement with Japan secured at political level, Juncker said there is a very good chance of doing the same with Mexico and South American countries by the end of 2017.
It was a very ambitious announcement, considering that trade negotiations with Mercosur countries (which include Brazil, Argentina, Uruguay and Paraguay) have dragged on for about 20 years, and have repeatedly stalled.
A change of government in Argentina and Brazil revived the negotiations last year, along with the EU calling the bluff of its own farmers, by giving into Brazil’s insistence that no deal can be considered until ethanol and beef are included.
Beef is back on the table, after the EU’s farmer lobby had earlier this year forced the Commission to withdraw an offer of an annual tariff-rate quota of 78,000 tons of Mercosur beef.
Mercosur countries already supply up to three-quarters of the EU’s beef imports. Their production costs are significantly lower than the EU’s.
EU farmers and processors fear that Brazil’s vast cattle ranches and sugar plantations will steamroller the EU’s beef and ethanol industries.
EU farmers were happy for trade deals with Japan and Canada to go ahead, but the EU’s new beef offer in Mercosur talks has put it on a collision course with its own farmers, regardless of big EU manufacturers seeking access to attractive Latin American markets. In contrast, the beef industry says now is not the time for an EU-Mercosur trade deal that would seriously undermine the EU beef market, with particular repercussions for the Irish beef sector. Meat Industry Ireland says Mercosur concessions on beef imports are “completely unacceptable”.
With Juncker also welcoming the start of trade negotiations with Australia and New Zealand, which he also wants finalised by the end of his mandate, plus signs that his Commission wants a significant reduction in the CAP budget, the reaction of EU farmers to his State of the Union address is “No more Mr Nice Guy”.