Challenges ahead for NI feed sector

He confirmed that with Northern Ireland still operating to EU rules after the UK has exited Europe, import checks on many goods arriving from Great Britain will be inevitable.

Depending on how the necessary controls are implemented, the trade could face substantially increased costs to maintain compliance. For materials containing products of animal origin such as milk powders, fishmeal or other animal derived ingredients there will also be a necessity for veterinary certificates - another cost burden.

Irvine commented: “Northern Ireland’s businesses need guidance to manage the new thinking around the range of complex issues which will affect the flow of feed materials.

“The Northern Ireland Protocol indicates that we must operate by European rules, yet the UK Command paper is clear: Northern Ireland will be guided by UK.”

“In the absence of an EU office in Northern Ireland what provision will there be for Northern Ireland business to avail of a technical reference point, to help them understand EU rules and enable them to manage trade challenges?”

The NIGTA representative added that local feed compounders are calling for a pragmatic approach to enforcement.

He said: “We need simplified systems to deal with duty rebates and regulatory checks. Even then we will be looking at massively increased administration, IT and training costs. The industry will need help from government if this cost is not to be reflected in increased feed prices, which will damage the competitiveness of the livestock sector.

“Tariffs of up to £60m could be payable on imported feed materials if they are deemed to be at risk of entering the EU specifically the Republic of Ireland. These tariffs should be refundable at the point of consumption if it can be proved that they remain in Northern Ireland.

“Given that the point of consumption is on Northern Ireland’s 25,000 livestock farms this could be a massive administrative burden. It could also represent a major financial burden if businesses have to fund these tariffs and await a rebate recovery from HMRC. This has been estimated to take at least three months, allowing for account stock periods, invoicing of forward sales through to making a claim. The working capital burden for the sector would be in the region of £15 million at any given time.”

According to Irvine, the Northern Ireland Protocol offers an opportunity for the province to enjoy trade within both Europe and Great Britain with unfettered export access to both regions. However it will be the practical application of the protocol, which determines if true unfettered access can be achieved, or if administrative, and cost barriers prevent full rollout as the UK Government intended.

He also pointed out that failure to reach an agreement on trade with the EU will create barriers to the movement of goods into Northern Ireland. As the UK diverges from European Union standards and tariffs, goods from Great Britain will treated as imports to the EU when they enter Northern Ireland: customs’ clearance while Sanitary and Phytosanitary (SPS) compliance will apply when they arrive at ports in Northern Ireland.

Irvine said that many of the materials currently imported, which are subsequently manufactured into compound animal feeds, benefit from special trade arrangements, which allow favourable access. These include the Canadian Free Trade Agreement, the Ukrainian Association Agreement and other agreements with Tariff Relief Quota available through the European Union. The future of these arrangements remains to be clarified; as does the position of Northern Ireland in respect of trade deals and tariff schedules, which will be introduced by the UK.

The NIGTA spokesman concluded: “We need clarity on the detailed implementation of the protocol and are asking for government to support the trade in four key areas.

“These are: the implementation of a simplified system of duty rebates in the event of no deal; allowing trade engagement with the Specialised Committee’s Expert Working Group on ‘at risk goods; ensuring access to the EU’s Quota for Ukraine/Russian goods and the provision of support to meet increased finance, IT and compliance costs.”