Summary
Both EU sugar beet producers and EU sugar users have expressed concerns a long-term trend towards reduced indigenous EU sugar production is underway. EU sugar users feel this could threaten the competitive position of EU sugar-based food and drink manufacturers. This has led to calls for a ‘radical shift’ in EU sugar trade policy, involving variously: production process ‘mirror clauses’ in trade agreements; the extension of the mandatory EU forestry due diligence regulation to sugar; and the establishment of a traffic light system for regulating sugar imports depending on EU sugar stock levels. However, EC medium term forecasts for the EU sugar market suggest no such sugar market crisis is likely. While current shortages should boost market opportunities for ACP sugar exporters, EU sugar imports are down, in the face of high global sugar prices and massive increases in sea freight charges to Europe. Any structural decline in EU beet production should increase scope for ACP sales to EU beet/raw cane sugar co-refiners. This, however, could complicate the commercial position of full time EU raw cane sugar refiners, while any ‘radical shift’ in EU sugar trade policy could serve to further erode the value of ACP preferential access to EU sugar markets. Overall, ACP sugar exporters face an uncertain future on the EU market, which will require close monitoring and the adoption of targeted marketing strategies by different ACP sugar exporters. Read more “Could EU Sugar Sector Developments Offer Opportunities for ACP Sugar Exporters?”
The Halting of the Decline in EU Poultry Production and Open Sub-Sharan African Markets, Fuels Continued Growth in EU Poultry Meat Exports to SSA
Summary
Despite initial setbacks linked to Avian Influenza outbreaks and Covid-19 linked demand effects, EU poultry meat production is projected to increase in 2021, with this growth continuing through to 2031 (though be it at almost half the annual rate of the preceding decade). Despite average EU poultry meat prices being substantially above Brazilian prices, the EU continues to increase exports of frozen and fresh meat and offal from Gallus poultry to sub-Saharan Africa. This increase has continued despite a major slump in EU exports to other non-sub-Saharan African markets. While overall EU poultry meat exports are projected to stabilise up to 2031, the likely further collapse in exports to the UK will increase export pressures on sub-Saharan African markets. If African governments wish to boost local poultry production in response to growing consumer demand and Covid-19 supply chain disruptions, greater use will need to be made of non-tariff measures in regulating imports, including a more precautionary approach in response to AI outbreaks. This could then provide the market space for expanded local production if this forms part of comprehensive poultry sector development strategies. Read more “The Halting of the Decline in EU Poultry Production and Open Sub-Sharan African Markets, Fuels Continued Growth in EU Poultry Meat Exports to SSA”
Ending of Transitional Arrangements for ‘Origin’ Declarations Could Pose Serious Challenges to Certain ACP Triangular Supply Chains
Summary
The lapsing of the transitional arrangement for reporting and verifying rules of origin compliance for goods entering from the EU from 1 January 2022, could see serious disruptions arising along a variety of ACP triangular supply chains. Products potentially affected include chilled and fresh fruit and vegetables, cut flowers, fisheries products, clothing products, value added cocoa products and sugar. From 1 January 2022, ‘originating status’ will need to be proved at the point of entry to the UK, and if this cannot be supplied standard MFN tariffs will be levied. This will require a clear understanding of the rules of origin applicable to the particular goods entering the UK. In addition, cargoes may need to visit inland border control facilities for documentation and physical checks, which could extend delivery times. It is only from 1 January 2022 that the full impact of the new rules of origin/MFN tariff complications along ACP triangular supply chains will be felt, with this making the establishment of an appropriate policy solution to this complication a matter of some urgency. Read more “Ending of Transitional Arrangements for ‘Origin’ Declarations Could Pose Serious Challenges to Certain ACP Triangular Supply Chains”
What Are the Implications of New EU Mandatory Forestry Due Diligence Requirements for ACP Agricultural Commodity Exporters?
Summary
The EC’s proposed forestry due diligence regulation seeks to ensure only commodities from land not subject to deforestation and produced in line with national legal frameworks are placed for sale on the EU market. This will involve the progressive establishment of full traceability of all of the affected commodities (beef, wood, palm oil, soya, coffee, and cocoa) placed for sale on the EU market. Obligations placed on businesses will vary based on country and region-specific assessments of the risk of deforestation or forest degradation. A process of benchmarking will be undertaken to establish these risk assessments (high, standard, and low risk). The EC favours a collaborative approach involving all concerned stakeholders in building Forestry Partnerships to promote the transition to active protection of global forestry resources. A €1 billion EC managed facility is to be established to support these Forestry Partnerships. The value of exports to the EU27 from the main ACP exporting countries potentially affected by the new due diligence requirements amounted to nearly €7 billion in 2020. In the ACP the most important affected sector is the cocoa sector, which accounts for 75% of the value of ACP exports of the affected commodities. Important questions arise related to the distribution of the costs of new traceability systems and mitigation measures along supply chains and whether forestry due diligence will be closely linked to decent living income objectives. Addressing living income issues, particularly in the cocoa sector, is seen as essential to ensuring active farmer ‘buy-in’ to the necessary farm level production process transition required to better protect global forestry resources. Read more “What Are the Implications of New EU Mandatory Forestry Due Diligence Requirements for ACP Agricultural Commodity Exporters?”
Can the Tesco Commitment Provide a Basis for a Wider Pan European Retailer Programme of Action Ensuring a ‘Living Wage +’ Outcome for Banana Workers?
Summary
Tesco’s latest commitment on ensuring banana plantation workers are paid, at a minimum, a living wage includes two important innovations: independent determination of the living wage requirement and the establishment of a clearly defined timeline for attaining living wage objectives. This approach is indicative of the kind of ‘best practice’ which the EC ‘Code of Conduct on Responsible Food Business and Marketing Practices’ would like to see generally adopted (including in other sector such as the cocoa sector). By concentrating responsibility for establishing living wage levels at the level of the stakeholder with the greatest power within the supply chain, the Tesco initiative offers a real prospect of progress on living wage issues. This would be particularly the case, if it was generalised across products and throughout the corporate family of which Tesco forms a part (ABF). Read more “Can the Tesco Commitment Provide a Basis for a Wider Pan European Retailer Programme of Action Ensuring a ‘Living Wage +’ Outcome for Banana Workers?”
Decline in EU Poultry Meat Exports to South Africa Provides Space for Renewal of the Domestic Poultry Sector
Summary
EU poultry meat exports to South Africa continue to decline, but illegal and mis-reported imports from Brazil continue to put pressure on domestic producers. While progress is being made on the domestic dimension of the Poultry Sector Master Plan, serious challenges remain in curbing illegal import from Brazil. Given the curbing of imports from the EU is largely based on SPS measures taken in response to AI outbreaks in Europe, the South African poultry Association is urging the South African government not to lift AI based import restrictions until six months after the last reported AI outbreak in the EU. With EU governments declaring their countries free of AI, this could heighten EU-South Africa poultry sector trade tensions. The South Africa experience highlights: the importance of appropriate trade policy responses to AI outbreaks in major exporting countries; the need for joined-up action across all relevant government services; and the need for active stakeholder engagement in elaborating Poultry Sector Development Strategies. AI outbreaks and Covid-19 linked freight disruptions, could provide opportunities for the expansion of domestic poultry production across Africa, if appropriate comprehensive poultry sector development programme can be set in place Read more “Decline in EU Poultry Meat Exports to South Africa Provides Space for Renewal of the Domestic Poultry Sector”
EU Frozen Chicken Exports to Ghana and Wider West African Region Continue to Rise
Summary
In the face of AI related import restrictions for other major destinations for EU frozen chicken and general poultry meat exports, EU exports to Ghana and other major West African markets have grown strongly. West Africa has now become a key market for exports of frozen chicken meat, particularly when difficulties are faced on other markets. This raises critical issues over the role of poultry sector trade policy in West Africa in supporting efforts to expand domestic poultry production, as part of wider poultry sector development initiatives. Read more “EU Frozen Chicken Exports to Ghana and Wider West African Region Continue to Rise”
Some Implications of the EU Code of Conduct on Responsible Food Business and Marketing Practices for ACP Producers
Summary
The EU’s ‘Code of Conduct on Responsible Food Business and Marketing Practices’ can only be welcomed. However, its limitations, in terms of delivering on objectives which ACP governments, producers and exporters share, need to be recognised. The focus on increased collaboration along the whole of the supply chain, means commitments entered into by EU companies will carry real implications for production practices adopted by ACP suppliers. These implications need to be recognised and addressed, in the context of the Codes commitment to ensuring the social and commercial sustainability of the required changes. In regard to each of the aspirational objectives identified, in operationalising the code of conduct there will be a need for meaningful dialogues with ACP stakeholders and governments, if the burden of necessary adjustments is not to be largely shifted on to the shoulders of ACP primary producers. This will require the identification of appropriate institutional frameworks for the conduct of these meaningful dialogues in each of the major areas of concern. Read more “Some Implications of the EU Code of Conduct on Responsible Food Business and Marketing Practices for ACP Producers”
EC Proposal for Resolving Northern Ireland Protocol Issues Could Offer Model for Addressing ACP Triangular Supply Chain Concerns
Summary
The EC’s proposals to resolve the problem of the implementation of the Northern Ireland Protocol try to accommodate the operational concerns of Northern Ireland business leaders. However, the proposals leave unresolved the fundamental political objections the UK government has advanced, on the basis of the objections of Ulster Unionists. While this reduces the prospect of an early EU/UK agreement on the basis of the EC proposals, the technical proposal advanced nevertheless could offer a model for addressing ACP triangular supply chain concerns. This would require an elaboration of the current principles and modalities underpinning the EC proposals, in order to address the specific realities faced along ACP triangular supply chains. This will require political lobbying by the concerns ACP governments and in-depth technical work by the concerns ACP exporters associations. Read more “EC Proposal for Resolving Northern Ireland Protocol Issues Could Offer Model for Addressing ACP Triangular Supply Chain Concerns”
EC’s “Fit for 55” Plan Roots in Earlier “Farm to Fork Strategy” Carries Implications for ACP-EU Agri-Food Sector Trade
Summary
This is the first in a series of articles which look at the implications of the EU’s new climate change focussed policy documents for ACP-EU agri-food sector trade relations. This article reviews the EU’s basic Farm to Fork strategy, which was first tabled in May 2020, and its implications for ACP-EU agri-food sector relations. A companion article will review the EU’s July 2021 Code of Conduct on Responsible Food Business and Marketing Practices, with both of these articles needing to be read in association with the recent epamonitoring.net article on Afruibana’s appeal to banana buyers in Europe to take on board the dramatic freight and input cost increases, so that all stakeholders in the supply chain carry a fair share of the burden of promoting the necessary ecological and energy transition which the climate crisis demands. Read more “EC’s “Fit for 55” Plan Roots in Earlier “Farm to Fork Strategy” Carries Implications for ACP-EU Agri-Food Sector Trade”