The United Kingdom’s exit from the European Union on Friday and the beginning of trade negotiations between the two blocs removes come uncertainty for NZ’s meat industry.
Parsons says he struggled to find anyone in the UK who voted for Brexit, although he suspected a few did. But none of the farming leaders he spoke to in either the UK or Europe could see many upsides to Brexit.
Irish farmers are being hit by low prices due the weak pound, he says.
Meanwhile, meat processors in Northern Ireland are deeply concerned about the prospect of a ‘hard’ border between the north and south of Ireland; they process a lot stock from the south. Their biggest concern is to get some stability, especially in the sheep market.
“Whilst they were not massively excited about NZ product coming in during their peak season, they acknowledge the importance of having lamb on the shelf 12 months of the year,” Parsons told Rural News. “I think there are opportunities for us, with the sheep producers in the northern hemisphere, to see how we can supply some markets in a counter-seasonal way. We had a much more mature conversation about this than I had experienced in the past.”
Parsons says it’s too early to say what might happen to NZ as result of Brexit. Many big political issues must be sorted out first, such as whether the EU will play hardball with the UK when it triggers its exit next March. The French and German elections may also influence events.
“We are quite narrowly focused on our existing trade, but it’s all the macro things that are in play, so the sheepmeat market is just going to be a minnow in the scheme of things.”
BLNZ, via its representative in Brussels, Ben O’Brien, will monitor the situation. BLNZ is keen for the NZ government to negotiate a free trade agreement with the EU and to firm up an arrangement with the UK when it leaves the EU. This is some way off because negotiations can’t start until the UK has left the EU.
Parsons notes a lot of interest in the UK about the way NZ has developed its markets over the years and become a free trading country. UK farmers are keen to do this, but old habits such as protectionism are alive and well there.