The Irish beef sector is likely to be hit hardest by the proposed TTIP trade deal between the EU and the US, according to a report published today by the Minister for Jobs, Enterprise and Innovation Richard Bruton.
The independent study on Transatlantic Trade and Investment Partnership (TTIP) by Copenhagen Economics showed that despite negative impact on the beef sector it is expected to increase Irish agriculture exports by 2% to 3% or €230-€270m, relative to 2013.
It says both dairy and processed foods are likely to see net exports increase as a consequence of the TTIP.
Total Irish exports of dairy are expected to increase by approximately €162m relative to exports in 2013, while imports are only expected to increase by €73m.
Changes in trade flows are expected to increase gross value added in the dairy sector by approximately €40m relative to 2013.
For the processed food sector, the report says exports are expected to increase by approximately €94m, while imports are likely to increase by €84m.
Overall the reports authors expect gross value added in the processed food sector to increase by around €10m relative to 2013.
Increased competition in beef sector
In the beef sector and to a smaller degree in the primary production sector, higher US competition on the domestic and the EU market will most likely emerge, according to the report.
These are, as a consequence, expected to be among the contracting sectors.
In the case of beef, the report expects output to contract by between 1% and 3%. Relative to 2013, this is equivalent to a contraction of between €25m to €45m.
The report says output in primary production is expected to contract by approximately 1.5%, equivalent to €49mrelative to 2013.
Depending on the actual outcome of the TTIP negotiations with respect to relaxation of quotas for US beef into the European market, and depending on the degree of change to other regulatory barriers in the beef sector, the reports authors say that Ireland’s beef producers should prepare for increased competition from cost efficient US beef producers in the European market.
The report says that the reduction in the output will, under all its scenarios, lead to a reduction of employment for all groups in the beef sector.