NSA update to media about the impact of Brexit on the UK sheep sector
16th December 2020
NSA is experiencing a high number of media enquiries that suggest there is a fundamental misunderstanding of how a failure to reach a free trade deal with the EU might impact on the sheep farming sector. At its more extreme there is a suggestion that the industry will need to call on Government to support a mass cull and disposal scheme, and there is also an assumption that individual sheep farmers export lambs to the EU.
To help the media report more accurately the NSA would like to inform that the vast majority of, virtually all, sheep farmers sell lambs from their farms to businesses that process them here in the UK. It is these companies that export carcasses or cuts of meat in bulk – regularly balancing different cuts between domestic and export markets. Because of this it will be these businesses, the meat processors, who must tackle the immediate challenges faced by a no deal scenario. A no deal outcome that would see high levels of tariffs applied would undoubtedly disrupt supply and demand, adding costs to exporting and making it difficult to compete in the EU market.
It is highly probably that such an outcome would fairly quickly result in downward pressure on prices that farmers can achieve for their lambs, but the market will still want lamb to fulfil demand and will naturally offer lower prices in order to be able to compete at retail level. Tariffs would affect UK farmers on the ground with potential market price collapses, but this disruption is also likely to be transitional and in the case of market collapse the government have given commitments of financial support.
Regarding rumours of the need for a mass cull and reduction of the national sheep flock the NSA absolutely does not accept this would be the case – there is strong demand for British lamb and globally the supply and demand dynamics are positive. NSA’s opinion is that prices would adjust to enable the market to function and unfortunately price drops (or additional costs in the case of tariffs) have a habit of working down to a farm gate level.
Some individual farmers do export breeding stock, selling these animals to farmers in the EU, and this trade looks likely to be immediately affected by our departure from the EU due to the UK becoming a 3rd country in its relationship with the EU, and there being no sea ports with the infrastructure needed to handle animals from 3rd countries. Trade in breeding sheep between the UK mainland and Northern Ireland is common and well established and the protocols agreed for NI look likely to seriously disrupt this trade. NI will now need to work to EU health and phytosanitary controls meaning ‘non-tariff barriers’ applied to internal trade.
For more information on breeding stock movements please see our designated page: https://www.nationalsheep.org.uk/events/reports/30413/the-impact-of-brexit-on-the-uks-breed-societies-webinar/.