Responding to the outcome of the summit, NFU Cymru President Aled Jones, said: “For some time we have been calling on government to pursue a better relationship with the EU, with the aim of reducing trade costs and friction. Securing an ambitious Sanitary and Phytosanitary Measures (SPS) agreement with the EU is one of the ways which will help to reduce friction at the border, and indeed that was something we called for in our general election manifesto of this time last year.
“I am pleased that the UK Government has clearly listened to these concerns. With the scope to remove Export Health Certificates and cumbersome controls at the border, this deal will deliver many benefits for agri-food exports to the EU.
Dismantling barriers to trade
“Since 1 January 2021, the EU has applied third-country customs and border controls to UK agri-food exports, including documentary and physical checks, with UK exporters of products of animal origin including meat and dairy, needing vets to inspect individual export consignments and sign Export Health Certificates.
“If we consider the volume of products moving into the EU from the UK since 2019, then these show a significant decline. Exports of meat and meat preparations have reduced by 33%, whilst dairy products and eggs have fallen by 20%. Although there are multiple contributing factors to these drops, new trade frictions under the post-Brexit EU-UK trade relationship are likely to be an important driver of these falls, and that is why we have to do what we reasonably can to reduce and dismantle these barriers to trade.
“Welsh food and drink exports to the EU were worth £813m in 2023, with meat and meat products accounting for £280m of this, and compared to the rest of the UK, Wales has been and remains more reliant on the EU as an export destination, with 75% of our food and drink going to the EU.”
Aled Jones, NFU Cymru President
“Welsh food and drink exports to the EU were worth £813m in 2023, with meat and meat products accounting for £280m of this, and compared to the rest of the UK, Wales has been and remains more reliant on the EU as an export destination, with 75% of our food and drink going to the EU compared to 57% of food and drink exports from the UK. Today’s news is therefore of particular relevance to Welsh farmers.”
Caution
Although encouraged by today’s news, Mr Jones did sound a note of caution saying: “Whilst today’s positive news should mean that in future our goods will be able to reach the markets of the EU 27 without the current costs and complexities which undoubtedly have impeded trade flows, we have always argued that trade with the EU must be based on equivalency.
“Despite the benefits this deal brings, full dynamic alignment comes at a significant cost of committing to future EU rules, in which we will have little say. There remain important questions about what is within the scope of this agreement and, where current rules and regulations do differ, if there will be any exclusions. NFU Cymru will therefore be taking a particular interest in what limited exceptions there might be to dynamic alignment and urging the UK Government to protect our ability to make crucial regulatory decisions domestically.”
What has been agreed?
SPS rules cover food safety and animal and plant health standards to ensure that food is safe for consumers and to prevent the spread of pests or diseases.
The UK and EU have announced their mutual agreement to negotiate an SPS agreement under certain parameters. Today is the start of the formal negotiations.
The agreement facilitates trade by reducing or eliminating the need for documentary, identity and physical checks, the necessary paperwork (eg, export health certificates, phytosanitary certificates) and the associated costs.
The UK will make a financial contribution in return for having access to decision making committees, databases and data, but it won’t have the right to vote as any other Member State. The agreement will apply to Great Britain, with Northern Ireland subject to the provisions in the protocol on Ireland/Northern Ireland. If there is a disagreement over the rules within the scope of the agreement, the EU Court of Justice will have the final say.
The EU and UK have also agreed to work towards linking ETS (Emission Trading Systems) through dynamic alignment in order to benefit from mutual exemptions from the respective EU and UK CBAMs (Carbon Border Adjustment Mechanism). Currently, the Carbon Border Adjustment Mechanism doesn’t cover agricultural products but has fertilisers in scope. The overall impact of alignment on the price of fertiliser is hard to gauge. The agriculture sector might benefit from consequent opportunities in the low carbon economy.