Bord Bia has signalled caution on the “impact of new competitive forces in a post-Brexit Britain”.

It was announced this afternoon (Thursday, December 24) that a Brexit trade deal has been met between the UK and the EU.

Also Read: Brexit trade deal between the UK and the EU announced

Responding to the news, CEO of Bord Bia Tara McCarthy has welcomed the free trade agreement reached, which will commence when the Brexit transition period expires on January 1, 2021.

“We welcome the clarity that this post-Brexit free trade deal brings for Ireland’s food, drink and horticulture sectors – but considerable uncertainty still lies ahead for our largest indigenous sector,” McCarthy said.

“With €4.5 billion in food exports destined for the UK last year, this market is crucial for our beef, dairy, prepared consumer foods and some horticulture producers.

Four years into the Brexit process, from January 1, Ireland will face an entirely new set of competitive forces in a post-Brexit Britain – as customs compliance procedures are introduced and the market further expands to global competition.

“January will see the introduction of customs declarations, health certificates and other processes that will be new to many exporters and will add additional costs and complexities to decades old supply chains.

“A continuing lack of detail on some elements of Great Britain’s border operating model will also bring uncertainty from January.”

‘Substantial ongoing costs’

Food Drink Ireland (FDI), the Ibec group representing the food and drink sector, has also welcomed the agreement reached between the EU and the UK on a future trading relationship. 

Paul Kelly, FDI director said: “The agreement is welcome as disastrous tariffs have been avoided – but the agreement reached is still very much a hard Brexit.

Food and drink companies will face substantial non-tariff barriers to trade between Ireland and Great Britain with customs, SPS [sanitary and phytosanitary controls] and other food safety requirements in a few days’ time.   

“This will lead to substantial ongoing costs which will have to be absorbed not just by the food supply chain, but by consumers as well.

“Reaching agreement on measures to ease and facilitate customs and SPS requirements should now be a priority for both sides. This is the only way to reduce trade friction and limit the costs passed onto the food chain and the consumer.”

FDI is now also calling for measures to support Irish food and drink companies maintain their “valuable UK market position and diversify into new markets”, including a state-backed export credit insurance scheme, along with increased investment in innovation, skills, enabling technologies and market development.

FDI believe that the EU’s €5 billion Brexit fund must be “utilised to support the most exposed sector in the most exposed country”, in addition to domestic funding from the government’s Brexit contingency fund.