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Fears over cheap beef imports from Latin America

October 6th, 2017 2:30 PM

By Southern Star Team

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THE EU is planning to offer an annual Tariff Rate Quota (TRQ) of 70,000 tonnes of hormone-free beef to the Latin American trade bloc Mercosur, according to draft figures circulated among member states, in a move which beef producers warn will flood the EU’s market with cheap imports threatening the livestock sector.

 The Commission presented the revised market access offer to experts at a technical meeting, allowing little time to confer with ministries back home. 

The EU negotiating team is in Brasília this week for the formal round of negotiations with their Mercosur counterparts. 

The draft offer comprises a TRQ of 35,000t (carcass weight equivalent) for fresh and chilled beef and the same amount for frozen cuts. 

Each of the two sub-quotas would be split into two subdivisions – Hilton beef/non Hilton beef for the fresh and chilled product and further processing/non end use for frozen, but there is no further information on the percentage. A duty of 7.5% would be applicable for both in-quota tranches. Furthermore, EU negotiators are offering a quota of 600,000t for ethanol – 400 000t reserved for industrial use. 

Two duty rates would apply – €6.4/hl for un-denatured and €3.4/hl for denatured. But the Mercosur side is far from satisfied, with sources recalling the EU-15 offered 100 000t in 2004 and pledged to ‘improve on 2004 offers’ when negotiations were relaunched at the EU-Mercosur Summit in 2010. The 70,000t draft figure ‘seems unlikely to be perceived as a step forward in the process’, they add. 

Meanwhile, the Brazilian sugarcane industry association (UNICA) expressed disappointment with the 600,000t ethanol offer. ‘Our ethanol achieves GHG savings of more than 70% … it can really contribute to the EU climate targets and to the bio-economy that the Commission intends to promote. Such an offer shows that the EU is not serious about climate change mitigation.’

Both French President Emmanuel Macron and Irish Taoiseach Leo Varadkar raised their concerns with Commission chief Jean-Claude Juncker in the margins of the Tallinn Digital Summit with EU leaders on September 29th. 

In a video message from the government jet in Baldonnel, Varadkar said he would insist on the ‘highest standards of animal welfare and also health and safety … and make sure that Irish beef farmers are competing on a level playing field, because fair trade is as important as free trade.’ 

The EU’s largest farm lobby Copa-Cogeca slammed the Commission’s moves to increase import volumes of beef and ethanol from the Mercosur countries, saying it would have a devastating impact on growth and jobs in rural areas and put further pressure on the market. Chairman of Copa-Cogeca’s Beef Working Party Jean-Pierre Fleury stressed it was ‘incomprehensible that the Commission has put beef in its market access offer to Mercosur when investigations into the Brazilian fraud scandal have not been completed’. 

The draft figure of 70,000t is ‘equivalent to 1.7m suckler cows in the EU and would result in 40% of high-value cuts that do not originate from the EU being consumed’, he outlined. The IFA is prepared to fight tooth and nail to block ‘any sell-out of the beef sector’ and held a protest outside Agriculture House in Dublin this week. 

IFA President Joe Healy said now was not the time to make concessions to South America, amid Brexit uncertainty and the Brazilian meat scandal. 

 

Rose O’Donovan is editor-in-chief of the Brussels-based publication Agra Facts and has been following the evolution of European farm policy for over ten years. 

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