New rules under Brexit are causing meat processors and exporters to face an increase in export costs of up to 40 per cent, an Oireachtas committee has heard.
Meat Industry Ireland (MII) said the increased costs are due to new customs and sanitary/phytosanitary (SPS) processes, delays and disruption in logistics and direct transport cost increases.
In a submission to the Joint Oireachtas Committee on Agriculture and the Marine, the Ibec sector association said the industry was facing a “double whammy” due to both the loss of frictionless trade caused by Brexit and the impact of the Covid-19 pandemic.
“We are dealing with the double whammy of Covid-19 and Brexit and both are relevant to the current market dynamics,” MII director Cormac Healy said.
“Covid-19 lockdown restrictions across Ireland, the UK and Europe are leading to a major drop in demand throughout food service channels, and Brexit contingency stockpiles put in place ahead of the Brexit deadline are now being released and reducing demand.”
MII said demand for Irish meat products from the food service and restaurant sector had been “decimated”, with increased sales through retail not enough to offset lockdown’s effect on the hospitality sector.
Haulier cost increases
Mr Healy said all agencies in the food supply chain had done “excellent work” to maintain the flow of trade since Brexit rules came into force on January 1st.
“But just because tariff and quota free trade has continued doesn’t mean the changes imposed by Brexit aren’t wide ranging and costly,” he added.
The industry group said that while an increase in direct sailings to continental Europe has helped provide exporters with an alternative to the UK landbridge, it costs between €500 and €800 extra per truck to send exports directly to the continent.
Hauliers sending trucks to the UK are furthermore looking to increase the costs they charge per journey, MII said, because they are facing difficulties filling their trucks for the return journey due to paperwork and “logistical minefields”.
The industry group also raised concern over a range of further Brexit measures due to come into effect between April and July.
“For example, from 1st April all products of animal origin will need to be accompanied by a veterinary certificate,” the group said in a statement.
“This will require over 350,000 Export Health Certificates to be issued per annum, with serious potential to cause trade flow disruption and add more cost to exporting.”
