Brexit risk to farming

A cliff-edge Brexit in early 2019 would pose serious risks to farming in Scotland, an independent study has concluded.

The Food and Agricultural Policy Research Institute (FAPRI), based at the University of Missouri, and the Agri-Food and Biosciences Institute in Belfast, analysed the impact of potential policy scenarios on the main product sectors within the farming sector, including:

• Bespoke Free Trade Agreement with the EU
• World Trade Organisation (WTO) default Most Favoured Nation tariffs
• Unilateral Trade Liberalisation

The report found that in every scenario, markets would be disrupted with some or all producers facing lower returns, and in certain cases possible higher consumer prices within the UK market.

Commenting on the report, Rural Economy Secretary Fergus Ewing said:

“As is becoming clearer by the day, Brexit is by far the biggest threat to farming and to our successful food and drink sector. This important study confirms what the Scottish Government has been saying all along – that rural communities’ interests are served best by Scotland remaining within the EU.

“This report clearly shows that failure to reach a deal with the EU, combined with taking a complete free trade approach, would disrupt every single sector of agriculture, with beef production in Scotland particularly affected. Even if the UK fell back on WTO tariffs, the impact for some farmers would be catastrophic, with our hill farmers paying the price.

“In the best case scenario, where the UK Government secures a trade deal with the EU on close to Single Market terms, this would still lead to farmers and consumers being worse off than they currently are.

“What is clear, is that a ‘No deal’ scenario should not be considered as an option. Walking away from the EU with no deal would be disastrous for farming and food production, would harm Scotland’s economy, with consumers paying the price.”

Background

All four UK administrations funded the research project and agreed the three broad post-Brexit trade scenarios modelled in the publication.

These scenarios are not meant to be viewed as predictions of likely Brexit outcomes, but were designed to illustrate a range of policy scenarios. The actual outcome of Brexit may contain elements of any or all of them, but is unlikely to match any of them exactly.

The Impacts of Alternative Post-Brexit Trade Agreements on UK Agriculture report is available on the AFBI website