EU agrees in principle trade deal with Mexico

The EU is continuing its drive to secure trade deals with benefits for the food industry as well as the wider eurozone economy.

It has agreed in principle a trade deal with Mexico that will see tariffs on EU food products reduced. This follows a similar trade deal with Japan.

The UK will continue to benefit from these trade deals until the Brexit transition period ends in 2021 and by then the Government will need to have secured similar deals if trade is to be maintained.

More controversially the EU has continued discussions with the Mercosur countries from South America on a new trade deal. This will give countries, including Brazil, reduced tariff access for meat. The EU is pressing ahead despite criticism of standards in the Brazilian meat industry.

The European Commission has put more flesh on the bones of its plans for the CAP after 2020.

Like the UK it wants to impose a limit on direct payments and has suggested setting this at e60,000 a year.

The farm commissioner, Phil Hogan, has said the policy must focus on small and mediumsized farmers.

Also central to the new policy is ‘generational renewal’, or aid to young farmers.

An area-based decoupled payment will be a priority of the new CAP. On cross-compliance and greening the commission is suggesting combining both in a single, less bureaucratic policy.

Flexibility is promised with additional payments for those that go beyond the basic rules.

The commission has claimed legislation to improve the welfare of hens in broiler units is delivering positive results.

It says EU-wide regulations have not only improved welfare, but helped with the drive to reduce antibiotic use.

The report shows three quarters of chickens are now produced at low or medium stocking densities under the legislation. Most at the higher levels are in France, followed by the Netherlands and Belgium.

The EU represents 11% of global poultry production, behind the United States, Brazil and China. Seven member states dominate production – the UK, France, Netherlands, Germany, Spain, Italy and Poland.

The European Commission has finally shifted a significant amount of milk powder from its intervention stockpile, without risking undermining the market – its aim since the stockpile topped 350,000 tonnes in 2016.

This month it offered around 90,000 tonnes and sold 24,000 without reducing its price. This undermines claims – partly to drive down prices – that ‘old’ product should be less valuable.

Despite weaker milk prices the commission is rejecting all tender offers to buy milk powder into intervention.

The commission has claimed legislation to improve the welfare of hens in broiler units is bearing fruit.

Richard Wright.