Summary
A June 2019 initiative to establish a minimum price for cocoa beans launched by the Governments of Ghana and Cote d’Ivoire faced a set-back in July when no agreement could be reached with chocolate sector representatives on how the new minimum price should be applied in practice. Cocoa farmer’s representatives have stressed the importance of ensuring any such initiative translates into higher farm gate prices for cocoa farmers. Consumer pressure on chocolate companies to fully integrate a living wage for cocoa farmers into the prices paid for cocoa beans and cocoa products is needed if the current impasse is to be overcome. Read more “Minimum cocoa price initiative faces challenges”
Category: Caribbean
New EU Fruit Fly Rules Cause Concern Amongst West African Mango Exporters
Summary
Stricter EU SPS import controls on Tephritidae (fruit flies) infestations due to come into effect on 1st September 2019 could pose challenges for West African mango exports to the EU. This is particularly the case for smaller scale exporters. In this context a ‘no-deal’ Brexit could offer some relief, if the UK could be persuaded to define the required SPS controls with reference solely to the agro-climatic conditions prevailing in the UK rather than across the whole of the EU. This is an issue which concerned ACP exporters should urge their governments to collectively take up with the UK government, with a view to establishing clearly defined structures for dialogue around such a review once the UK is no longer subject to the rules of the EU’s customs union and single market. Read more “New EU Fruit Fly Rules Cause Concern Amongst West African Mango Exporters”
SPS and Food Safety Issues Likely to be Central to US/UK Trade Negotiations
Summary
Ensuring the UK moves away from restrictive EU SPS requirements is likely to be central to the post-Brexit US-UK trade agreement negotiations. If the UK begins to move away from EU SPS and food safety control systems in relations with the US, this could open up new opportunities for ACP exporters whose market position is coming under increasing pressure from the EU’s new Plant Health Regulation, which is likely to come into force only after the UK is no longer part of the EU Customs Union and Single Market. While the citrus sector is the most obvious area where the ACP would have an interest in initiating dialogue with the UK over the SPS import requirements to be applied in the post Brexit period, a review of the UK’s Plant Health Information Portal suggests the initiation of an dialogue on the UK’s future SPS import requirements could prove useful in a range of other areas where increasingly strict EU wide import requirements are being imposed. Read more “SPS and Food Safety Issues Likely to be Central to US/UK Trade Negotiations”
Is long term EU sugar demand set to fall even more dramatically?
Summary
There is growing evidence that taxes on the sugar content of beverages are having a proportional effect in reducing sugar consumption. This, along with new technological innovations which could see a similar reduced sugar consumption trend take hold in the food products sector, suggests ACP sugar exporters need to find new high sugar consumption growth markets. This will be complicated by the ongoing efforts of EU sugar companies to similarly identify new market opportunities for sugar exports, efforts which will be given an added stimulus by a ‘no-deal’ Brexit. Read more “Is long term EU sugar demand set to fall even more dramatically?”
Growth in Fairtrade sales in France good news for St Lucia but shift to dual certification is a constraint
Summary
Fairtrade banana sales in France have grown rapidly following the ‘sourcing decisions by major supermarket chains’. St Lucian exporters are now seeking to target the French Fairtrade banana market in light of the Brexit related uncertainties. However the consumer trend towards dual certified Fairtrade/Organic bananas poses challenges for St Lucian exporters, given the absence of treatments for Black Sigatoka (black leaf streak) in wet tropical regions which are accepted by organic certifiers. This suggests the UK market will remain of considerable importance. This highlights the need for CARIFORUM leaders need to launch a political dialogue with UK on the need to retain both existing MFN banana sector tariff in the longer term and existing quota ceilings on reduced tariff access, determined on a pro-rata basis through the apportionment of existing bilaterally negotiated EU banana TRQs between the UK and EU27 market. In addressing the TRQ apportionment issue CARIFORUM leaders could usefully ally with political leaders in African banana exporting countries, who would be most severely impacted by the disruptions on EU27 markets which would follow on from any mismanagement of the apportionment of existing EU bilaterally negotiated banana TRQs. Read more “Growth in Fairtrade sales in France good news for St Lucia but shift to dual certification is a constraint”
South Africa-EU CBS Dispute Takes a New Twist
Summary
The discovery of the Citrus Black Spot (CBS) fungal infection in citrus imports from Tunisia could prove a game changer in terms of South African efforts to secure a reduction of the EU’s commercially costly CBS control requirements. This is likely to give added important to discussions with the UK on its’ future SPS control arrangements to be applied under ‘no-deal’ Brexit Continuity Agreements. Removing controls on a citrus specific infection in a context where the UK has no commercial citrus production, alongside a lifting of TRQ restrictions on South African duty free access to the UK market, could help unlock the currently stalled UK-SADC EPA Continuity Agreement negotiations. This would be particularly the case if such a move signalled the UK governments’ willingness to respond more broadly to the changed trade realities which a ‘no-deal’ Brexit will give rise to. Read more “South Africa-EU CBS Dispute Takes a New Twist”
EU Formally Challenges Application of SACU Safeguard Duties in the Poultry Sector
Summary
The EC has initiated a process leading to the establishment of an arbitration panel to rule on the validity of safeguard measures taken against EU poultry meat imports under the EU-SADC Group EPA. While many of the EC’s objections are technically correct they ignore the wider context of the evolution of EU poultry meat exports, to which tariff reduction and ‘tariff standstill’ commitments contained in the pre-existing EU-South Africa TDCA made a unique contribution prior to the introduction of SPS related import restrictions in December 2016. With the progressive lifting of these restrictions, the longer term structural trend towards increasing EU exports of poultry meat to South Africa is beginning to re-assert itself. This needs to be seen against the background of concerns a ‘no deal’ Brexit could lead to a huge surge in EU27 poultry meat exports to extra-EU markets. In this context the current EC action can be seen as part of EU ‘no-deal’ Brexit preparations. As such this raises the spectre of the aggressive pursuit by the EC of the full implementation of nominal EPA commitments, so as to open up new market possibilities for EU27 export sectors facing the prospect of severe trade and market disruptions under a ‘no-deal’ outcome to the ongoing Brexit process. Read more “EU Formally Challenges Application of SACU Safeguard Duties in the Poultry Sector”
Low EU sugar prices lead to calls for greater market transparency
Summary
EU sugar production estimates have been revised down, with the prospect of a greater market balance and some price recovery emerging. However a ‘no-deal’ Brexit could push 550,000 tonnes of EU27 white sugar back onto the EU27 market, exerting a downward pressure on EU27 sugar prices. In contrast shortages of sugar would be likely to emerge on the UK market which would increase demand for imports of both raw cane sugar and refined sugar from preferred suppliers as well as an increase in UK sugar prices. With spot market prices currently above contracted sugar prices ACP exporters may need to re-evaluate their marketing strategies. However not only is their uncertainty over the basis of the UK’s departure from the EU but also over which existing trade agreements the UK will succeed in ‘rolling over’ by November 2019. The EC is busy preparing for a ‘no-deal’ Brexit in the sugar sector. The ACP Ambassadorial Working Group on Sugar should initiate a dialogue with the EC on the nature of these preparations and the likely implications for ACP sugar producers, given the profound effects EU policy measures can have on the functioning of the EU sugar market. Read more “Low EU sugar prices lead to calls for greater market transparency”
UNCTAD Reviews Impact of Future UK MFN Policy on Low Income Developing Countries
Summary
The UNCTAD analysis highlights the central importance of future UK MFN tariffs to the value of any ‘rolled over’ ACP preferential access to the UK market. This is an important issue under both a ‘no-deal Brexit and a ‘hard Brexit’. This will require effective ACP lobbying of the UK government to retain in place existing MFN tariffs in areas of greatest interest to ACP exporters. In the country and product analysis undertaken by UNCTAD the importance of triangular trade flows to the UK via the Netherlands is neglected, with this trade also being adversely impacted by any changes in EU MFN tariffs. Read more “UNCTAD Reviews Impact of Future UK MFN Policy on Low Income Developing Countries”
EU Sugar Exports to ACP Markets Are Falling After Record Levels of EU Exports in 2018
Summary
While after the exceptional level of EU sugar exports in 2018, export volumes are projected to be substantially reduced in 2019 (with export levels down 50% so far), these are still projected to be above EU export volumes in 2016/17 (+73% so far). What is more on average ACP markets in 2018 took 1 in every 5 tonnes of extra-EU sugar exports, up from 1 in every 14 tonnes in 2014. West Africa is the main ACP region for EU sugar exports, with Ghana and Senegal the two most important markets. Central Africa is the second most important ACP region with Cameroon leading the way as a destination for EU sugar exports. There have been surprisingly high levels of EU sugar exports to the eastern and Southern Africa region, given this is a sugar surplus region. EU sugar exports to the Caribbean have varied with exports to Haiti dominating the trend in overall EU sugar exports. While weather events and national trade policies play a role in patterns of EU sugar exports, there are concerns that ‘no-deal’ Brexit related trade disruption could lead to a growing EU corporate focus on sub-Saharan African markets. This could well give rise to pressure form the EC on ACP governments to abandon policies which restrict EU sugar exports. Read more “EU Sugar Exports to ACP Markets Are Falling After Record Levels of EU Exports in 2018”