Trade figures indicate Brexit decimation of beef exports to UK

UK imports of 11,600 tonnes of fresh and frozen beef in February were 40% lower than in February 2020

UK’s February beef imports are down 40% year-on-year, and 7% lower than January. File Picture. 

Trade statistics indicate that the severe Brexit effect on Ireland’s beef trade to the UK intensified in February.

The UK’s imports of 11,600 tonnes of fresh and frozen beef in February were 40% (7,600 tonnes) lower than the same month a year ago, and 7% lower than January 2021.

Lower imports from Ireland accounted for most of the 40% decline, with Irish volumes totalling 8,700 tonnes for the month.

Volumes from Poland and the Netherlands also fell, by 28% and 42%, respectively, according to an Agriculture and Horticulture Development Board report based on HMRC trade data.

The AHDB said HMRC’s trade data collection has changed, and comparisons with historic data should be treated with caution.

But huge disruption of trading with our single most important beef export market, by far, is obvious.

Evidence from the UK’s Business Insights and Conditions Survey (BICS) suggested that additional paperwork and higher transportation costs were the biggest challenges facing UK importers (and exporters) in February.

The UK’s Office of National Statistics said: “Trade patterns are likely to also reflect the impacts of the unwinding of stocks, coronavirus pandemic restrictions, and lower demand due to the UK and global economic recession.

“It is too soon to be able to assess to what extent recent trading patterns are short-term or reflect more lasting structural changes.’’

Difficulties 

Already, trade figures for January had pointed to Brexit knocking nearly 40% off Irish beef exports to UK.

Brexit and Covid-19 have combined to hugely upset our trade with the UK, which took an estimated 44% of primary Irish beef exports in 2020. 

Difficulties for exporters and importers in adjusting to the UK being out of the EU customs union since January 1 have to be taken into account.

Meanwhile, demand was reduced by the significant decline in foodservice during the lockdown, although this was somewhat counteracted by strong retail demand.

However, the retail market favours British-produced beef.

And how much of the market was supplied through January and February by stockpiled beef imported in December in preparation for Brexit disruption?

As the UK unwinds its lockdown measures, it is reasonable to expect that volumes of imported beef will increase, to serve the foodservice market as it reopens.

While import volumes fell in February, the average price of imports rose by 11% year-on-year.

This meant total imports were valued at £49.7 million, down 33% from a year ago.

Markets

Markets are also adjusting to reduced UK beef production, 5% lower in March compared to a year ago. Production was also lower in January and February, but by a lesser amount.

Declines in prime slaughter levels were steepest in Northern Ireland, dropping 11% year-on-year, 5% in Scotland, and 3% in England and Wales.

It has all worked out well for UK beef farmers, who have seen cattle prices rise by 70p/kg in the past year.

According to the AHDB, strong retail demand is particularly positive for British beef demand, but as the foodservice market reopens, “we might reasonably expect more competition from imported beef through these outlets”.

The UK’s cattle slaughter decline in the year to March has particularly affected the cow throughput, falling 7%.

UK beef exports in February were 59% less than the same month a year ago, but up 81% on January volumes.

The value of all food and live animal imports to the UK were down 11% for the first two months of the year. 

The vast majority of the decline was in EU trade, with meat and meat preparations, as well as vegetables and fruit being particularly hit.

Border Control

Much of the border control plan has been postponed to later in the year and next year, which could mean further trade disruption down the line, when pre- notification and export health certification for animal products will be required from October 1, and for low-risk plant and plant products from January 1, 2022, the same date when physical checks on a range of agri-food products and high-risk plants will start at Border Control Posts.

Physical checks on live animals and low-risk plants and plant material will not take place until March 2022 at Border Control Posts.

On top of these disturbances in the coming year, the continued stop-start of Covid lockdowns will also affect trading.

Meanwhile, Central Statistics Office figures indicated that Irish exports to Great Britain (England, Scotland, and Wales) decreased by €107m (11%) to €859m in February 2021 compared with February 2020.

The largest fall was in the exports of food and live animals, down nearly 30%, from €289m to €203m. 

These exports fell from €570m to €395m for January and February together.

But this seems to have been offset by non-GB exports, with exports of food and live animals increasing to the EU, from €275m to €324m in February (from €553 to €569 for January and February together)

Exports of food and live animals increased from €20m to €24m in February to the USA (from €46m to €52m for January and February together).

Exports of food and live animals increased from €55m to €56m in February to China (but fell from €132m to €103m for January and February together).

To the rest of the world, exports of Irish food and live animals increased from €220m to €247m in February (and from €435m to €474m for January and February together).