What an eventful 12 months it has been: the UK said cheerio to the EU and Donald Trump got himself elected to the White House. Both events may well have direct and indirect consequences for agriculture in Northern Ireland over the coming years. But the biggest issue in the short term is the tremendous uncertainty that both events have created.
My big fear regarding Brexit is that it may take a decade or more for all of its consequences to become fully apparent.
This timeline is based on the assumed two-year push that will be required to complete the formal withdrawal negotiations and the period thereafter which will see the UK striving to reach its own trade deals with other countries around the world. And let’s be clear about this: it is the time interval between Britain leaving the EU and London actually getting on with the trade negotiations that it needs to complete which will see agriculture and food here in Northern Ireland most exposed to the ravages of the world’s commodity markets.
My understanding is that, unless a formal trade agreement is in place between two countries or groups of nation states, WTO rules kick-in automatically. And where beef is concerned, the import levies that must be paid are up at almost 40% of the product value. Obviously, it makes sense for the UK to sort out new trading arrangements with the remaining EU-27, as an integral part of the Brexit negotiations. But we must never lose sight of the fact that Brussels will be in the box seat when it comes to sorting these matters out.
The great compensation for the local livestock industry is the pivotal role played by the supermarkets when it comes to selling beef in the UK. Beef prices in England, Scotland and Wales remain the highest in Europe. And let’s hope this continues to remain the case. But the real challenge moving forward is that of ensuring livestock farmers get a fair proportion of the money coming into the sector at the retail end.
Meanwhile, 2016 will go down as a year of two halves for milk producers. Eventually, Brussels stepped up to the plate and delivered enhanced intervention measures and the voluntary reduction scheme. But this is only a sticking plaster approach that does nothing more than keep the dairy sector on life support until the next crisis breaks. However, when that happens, I fear the worst: Brussels will claim it has no money and then we will see real carnage at farm level throughout Europe. This will only be averted if processors and farmers come up with solutions to the challenge of volatility – the clock is ticking!