Brexit fears come to pass as North exports fall

Farmers’ Brexit fears have been proved correct by the decimation of prime beef cattle exports to Northern Ireland.

In the six-week period ending September 10, only 703 animals were exported, compared to 2,488 in the corresponding period in 2015.

The Brexit-induced decline in the value of sterling against the euro has contributed to a 70% disappearance of the trade, compared to last year.

The cattle from the south have slumped from 8% of the North’s prime beef kill to only 2%.

In the Irish Examiner ICMSA farming poll, carried out between August 14 and September 4, 80% of the 526 farmers interviewed agreed that Brexit will reduce prices and farm profitability.

Only 11% said ‘no’, and 9% were “don’t knows”.

Brexit has reduced prices or profitability already, said 60%-63%.

This is certainly the experience of any southern farmers who had been benefiting from cross-border trade.

Imports of younger beef cattle from the south for further rearing on northern farms have also been notably lower in 2016.

Brexit fears come to pass as North exports fall

So far this year, 1,643 male store cattle have been imported, compared to 4,734 in the same period in 2015 — probably mainly due to the decline in the value of sterling against the euro making the southern cattle more expensive for northern buyers than in previous years.

Sterling fell 11%-12% against the euro after the Brexit vote.

The exchange rate fluctuation has decimated cattle trading from south to north, which had already been under pressure because many northern beef processors’.

Major retail customers were only purchasing beef from animals born, reared and finished on UK farms, limiting market outlets for beef from southern cattle.

As a result the Livestock and Meat Commission for Northern Ireland has advised farmers considering importing cattle from the south to first identify a market outlet for these cattle when they are finished, and to be aware of their potentially lower market value at slaughter.

A relatively steady supply of prime cattle from farms in the North this year is another factor in the 2016 cross-border trading slump. 

The live trade to the North has been small compared to the 272,000 tonnes per year of Irish beef (54% of our beef exports) which goes to the UK in general.

However, beef processors have warned that Brexit threatens this trade also.

Cormac Healy of Meat Industry Ireland said: “Brexit is a significantly negative event over the medium term for Ireland and its immediate impact is already being experienced in the exchange rate volatility and loss of competitiveness.”

He called on the entire beef industry including farmers to focus on the real challenges and risks for the sector arising from Brexit. 

“We need the Government to react quickly and decisively to ensure that Ireland’s food exporting sector is strongly positioned to withstand these competitive threats,” he said.

The Irish Examiner ICMSA farming poll reveals that most cattle farmers are aware of the Brexit threat, with 71%-73% saying the UK’s vote to leave the EU will reduce profits and prices for their cattle, and up to 55% saying this has happened already.

Nearly half of them say Brexit will affect their farming plans, but only 34% say Brexit will cause them to cancel an expansion or an investment.

READ MORE: The Irish Examiner / ICMSA farming survey: Methodology 

Find more on the Irish Examiner ICMSA farming survey HERE

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