World Grain - March 2019 - 28

Alex Waugh, director
of the National
Association of
British and Irish
Flour Millers
(nabim).
Photo by Chris
Lyddon.

Book 1.indb 28

ernment. The major sticking point is the arrangements
for the border between the Irish Republic and Northern
Ireland, part of the U.K. Outside the E.U.'s Single
Market and Customs Union, World Trade Organization
rules require that there are checks at the border. The
Good Friday Agreement of 1998, a peace treaty between the U.K. and Ireland that brought an end to
decades of civil strife in Northern Ireland, requires
that there should be no border. U.K. Brexit supporters claimed that they could find a way around that, but
haven't come up with a practical proposal.
The Withdrawal Agreement includes a so-called
backstop, keeping Northern Ireland within the Customs
Union for as long as necessary. Pro and anti-E.U. MPs
objected.
If the Withdrawal Agreement were to be accepted,
and there is no sign of the E.U. being prepared to offer
an alternative deal, while the U.K. has not put forward
any alternative proposal, then everything would carry
on unchanged through a 20-month transition period.
"You could go a long way to resolving this with a
customs union," Waugh said. "The biggest barrier to
maintaining the status quo is the tariffs. Once that's
dealt with, everything is much more manageable."
He put U.K. flour exports at about 185,000 tonnes a
year to Ireland and about 50,000 tonnes to other E.U.
Member States each year.
"Quite a lot of our flour trade, a lot of our flour capacity suddenly without a home, so the millers in Northern
Ireland and the North West of England must find a new
market or they aren't viable any longer," he said.
Tariffs would also affect trade in processed products, which adds to the problem. U.K. Environment
Minister Michael Gove told the National Farmers
Union Conference on Feb. 19 that tariffs would be applied to U.K. food imports.

"No deal's not really an ideal outcome," Waugh said.
He stressed how closely the two countries are linked.
"For all intents and purposes, when it comes to food
and agriculture, the U.K. and Ireland is one market,"
he said.
The Irish reaction to the prospect of tariffs has been
one of dismay. The country's Agriculture Minister has
confirmed that tariffs on its food imports would cost
€1.7 billion (US$1.9 billion) a year. Flour and bakery
product prices are expected to rise by about 30%.
On Feb. 21, the organizations representing food retailers in the U.K. and the Republic of Ireland highlighted their concerns over food prices post-Brexit in a
joint statement, from Aodhán Connolly, director of the
Northern Ireland Retail Consortium, Thomas Burke,
director of Retail Ireland and William Bain, head of
E.U. and international at the British Retail Consortium.
Burke, director of Retail Ireland, the relevant organization in the Republic, said "a 'no deal' Brexit would
have devastating economic consequences and must
be avoided."
"Regardless of the type of Brexit agreed over the
coming weeks, retailers will see an increase in their
operating costs arising from checks at ports and other
supply chain disruption," he said.
Connolly pointed out that "a no-deal Brexit brings
tariffs, customs processes, checks and costs that our
industry, and Northern Ireland families in particular,
cannot afford to absorb."
"A no-deal Brexit will hit us first and hit us hardest,"
he said. "This is not acceptable. A hard Brexit means
a hard border and the disintegration of supply chains
that have been built up over 40 years of E.U. membership. This is not a binary choice for Northern Ireland
between trade with the U.K. and trade with the E.U.
Our economy is built on access to both markets and we
need that to survive."
Bain stressed "our supply chains are highly integrated, with food ingredients coming from both Ireland and
the E.U., and 60% of the £2 billion of Northern Ireland
agri-food bound for Great Britain crosses the Irish Sea
via Dublin."
According to the group's statement, "a "no-deal outcome would have devastating economic consequences,
possibly eopardizing years of positive economic development and integration across the islands of the U.K.
and Ireland. It is imperative that this be avoided."
Chris Lyddon is World Grain's European correspondent.
He may be contacted at: chris.lyddon@ntlworld.com.
We want to hear from you - Send comments and inquiries
to worldgrain@sosland.com. For reprints of WG articles,
e-mail reprints@sosland.com.

March 2019 / World Grain / www.World-Grain.com

3/6/2019 12:30:54 PM

http://www.World-Grain.com

World Grain - March 2019

Table of Contents for the Digital Edition of World Grain - March 2019