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Brexit deadline pressures UK farmers to export surpluses

Farmers across the UK are desperately trying to finish their harvests and ship their surpluses abroad before the Brexit deadline of 31 October, as by then a no-deal departure would force them to abandon European markets in favour of Africa.

A no-deal departure would drastically curtail access to EU markets, with only a limited amount allowed in at a tariff of €16 a tonne. Farmers would be left seeking markets in north Africa, where mainly British grain would have to be discounted to compete, leaving many out of pocket.

Fresh chipping sector
With regard to the British fresh chipping sector, this makes up c.12% of total potato production in Great Britain. The market follows season trends with demand driven by chip shop footfall throughout the year. Most of the crop is utilised domestically, but a steady stream of exports to the Republic of Ireland (ROI) provides an underlying support to the market.

The UK exports around 55Kt of fresh potatoes to ROI each season, with monthly exports steady at c.4Kt. Trade codes do not allow us to tell the difference between chipping potatoes and other fresh potatoes. This being said, anecdotally we are told that most of these are chipping potatoes grown in the East of England.

When a no-deal Brexit comes into play, the UK will be unable to export fresh potatoes into the EU until the UK is granted third country equivalency. Also, once the UK has left the EU exports of chipping potatoes to ROI will cease until an agreement with Brussels is reached on phytosanitary regulations.

Realistically, this issue could take some time to reach a conclusion. Each month it remains unresolved an increasing volume of chipping potatoes will need to find a home in a domestic market, in which demand looks muted at best.

There are also some reports that growers in ROI have expanded their chipping area this season. Should this continue, UK imports could be displaced by increasing domestic supply early in the season. In the short term a lack of investment in high quality frying stores means that imports will still be required in the latter half of the season.

Longer term a dwindling export market and smaller chip shop portions may hit demand in the chipping market. As such we may need to see a decrease in the UK chipping area to re-align supply and demand over the coming years.

Source: theguardian.com

 


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