The EU-Mercosur trade deal is neither fair nor balanced for farmers. It’s just a bad deal designed to present the EU Commission as people who can get ‘the deal done’. Farmers know that’s easy if you are prepared to concede enough. That’s what happened here.
The EU is trying to play down the sheer size and impact of the deal on beef and poultry. The facts are it involves an additional 99,000 tons of beef from Brazil and other Latin America countries. This comes on top of around 230,000 tons of beef they are already sending into our market. In total, the South Americans will have access for around 330,000 tons.
However, a lot of this product can come in the form of steak cuts and really damage the market. Steak cuts make up 8%-10% of the volume, but account for up to 30% of the price return.
If the South Americans were to use all their access as steak cuts, in effect the Commission has given them over 40% of the EU beef steak market. This makes no sense and cannot be allowed to happen.
The latest EU Commission report show the beef price in Brazil at €2.17/kg and the EU price at €3.62/kg. That’s a price difference of €522 on a 360kg carcase.The Commission has also given additional access for 180,000 tons of poultry meat and for 25,000 tons of pigmeat.
Poultry and pig farmers and processors in Ireland must comply with higher EU standards on animal welfare, food safety, traceability and environmental protection. Farmers have invested time, energy and capital, to comply with these higher standards.
A 16% hit on EU beef prices is a loss of up to €5bn per annum, according to the Joint Research Centre. For the Irish beef sector, the hit could be €500m or more.
The BBC reported this week that the Brazilians are burning down rainforest the size of a football pitch every minute. On the other hand, Irish farmers have under-taken 250,000 carbon assessments on their farms and all our beef exports are part of the Bord Bia Sustain-able Assurance Scheme.
The JRC has also highlighted that Irish beef production systems are four times more carbon efficient that Brazil. Incorporating Land Use Change, GHG emissions from Brazilian beef are estimated at 80kg co2-eq/kg compared to 19kg co2-eq/kg for Irish suckler beef.
The Commission has no credibility when they are prepared to replace sustainable beef production in Ireland with sub-standard imports from Brazil and deal away the environment in the process.
Following the Weak Flesh meat scandal and corruption cases in March 2017, the EU Commission Food and Veterinary Office carried out an audit and report in Brazil.
Its report said: “It is of concern that most of the shortcomings detected during this audit were the subject of recommendations in previous DG Sante audits.
The Brazilians fail to meet EU standards on beef across all the main areas such as traceability, food safety, animal health, the environment and labour standards.
They don’t tag their cattle, they have no data base and no traceability. They have hormones, beta agonists and other growth promoters. These are all banned in the EU, but are widely available and used in Brazil. They have endemic foot and mouth disease which is a constant threat.
With the increasing threat of Brexit and the potential loss of our largest beef export market to the UK for 290,000t of beef exports, it is illogical for the EU Commission to do this deal with Mercosur. The EU beef market is already over supplied, due to existing sub-standard south American imports, and is 102% self-sufficient. With the UK out this self-sufficiency would increase to 116%.
Our Taoiseach Leo Varadkar, Minister for Agriculture Michael Creed, and EU Commissioner Phil Hogan must recognise that beef is more important to Ireland than any other member state. They have to fight for farmers and rural areas, where beef farming is the very heartbeat of economic activity.
Tomorrow, the IFA will undertake a full lobby of every TD and senator. Our Brussels office has also set down a comprehensive programme working with our fellow farm organisations through the European farmer group COPA. While the Commission has sold us out, we will fight to have this deal blocked.