Executing contingency plans to cope with a no-deal Brexit will be "massively challenging" for the Irish food and drinks sector over the next four months, an Oireachtas committee has heard.
Speaking on the impact of the UK’s exit from the EU next March on the agri-food sector, Padraig Brennan, director of markets at Bord Bia, said the State’s food promotions agency was “as ready as anybody can be” for “a doomsday” scenario involving Britain crashing out of the EU.
However, he set out areas of concern where the Irish food industry would be badly affected by the imposition of hefty World Trade Organisation tariffs on imports and exports into and out of the UK should the draft Brexit agreement fail to be passed.
Mr Brennan told the Oireachtas agriculture committee that tariffs imposed on beef exports to the UK in a doomsday no-deal scenario would leave Irish exporters in “a really severe situation”.
The UK accounts for just over one-third of all Irish food exports – €4.4 billion worth in 2017 – with about half of all beef and cheddar cheese produced in Ireland sold in the British market.
Displacing that amount of beef into other markets would be “really challenging” and would put exporters into competition with European suppliers also pushed out of the UK market, he said.
Beef trade
The Irish food sector was facing potential WTO tariffs of up to 53 per cent. On beef, tariffs in a no-deal scenario would be 12.8 per cent of the product’s value plus a duty of €3,000 per tonne.
“They would have a significant and a very serious impact on our ability to supply the UK market,” Mr Brennan told the committee.
It was “next to impossible”, he said, to see how food prices could stay at their current levels in the UK in that scenario and there was no appetite among UK consumers to spend more for food.
Asked about contingency planning for the importing of food, Mr Brennan said Bord Bia had met five major retailers in the Irish market who were trying to “map out” their existing supply chain to see where products come from and if they would be replaced by local Irish suppliers post-Brexit.
The agency was working with retailers to see where Irish suppliers might provide supermarket products under private labels and to meet future needs for ready meals and yoghurts, which they can produce, and products such as tortilla wraps and dips, which are not traditionally produced.
Further progress was required, he said, to be prepared for a no-deal Brexit.
