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”
Category: SPS / Food safety
Concerns Expressed Over Lack of Preparedness for October 2021 UK Controls on Goods Crossing from the EU
Summary
There are mounting industry concerns the UK authorities are not ready for implementing controls on goods crossing over from the EU scheduled to be introduced in October 2021. The de facto extension of the ‘Operation Brock’ emergency powers to regulate traffic flows along the main cross channel routes is seen as an implicit recognition of the dangers of road traffic disruptions. The serious air and sea freight disruptions and freight rate increases over the last year is complicating ACP efforts to restructure triangular supply chains, so as to deliver directly to the UK. This makes getting to grips with the sources of cost increases for ACP re-exports shipped to the UK via the EU a matter of considerable urgency. There is considerable scope for unilateral UK government action to reduce costs increases along triangular supply chains, without this impacting on broader UK/EU negotiations on trade related issues. Equally, on the EU side there is also scope for unilateral actions to reduce cost increases and delays along triangular supply chains. Read more “Concerns Expressed Over Lack of Preparedness for October 2021 UK Controls on Goods Crossing from the EU”
Fundamental Restructuring of Supply Chains Increasingly Needed in Absence of Progress in EU/UK Discussions on the Implementation of Necessary Border Controls
Summary
UK retailers with operations in the EU are counting the costs of the UK’s exit from the EU single market, with a fundamental restructuring of supply chains looking necessary if the affected UK companies are not to lose market share in EU27 countries. This is particularly the case since there continues to be little progress towards the obvious short-term solution, a formal agreement on the ‘temporary’ alignment on UK regulatory requirements with existing EU standards. Rather than pursuing this option the UK government has announced a major regulatory review which will include a review of the use of the EU’s ‘precautionary principle’ approach and its replacement with a ‘proportionality principle’. Such a move can only complicate efforts to find agreements which will restore the smooth flow of goods across EU/UK borders. Against the background of the need for restructuring of supply chains ACP agri-food exporters need to identify how they will adjust their export operations in order to fit into these new restructured supply chains. Early adjustments could help individual ACP exporters sustain and even gain market share, while a failure to adjust could see a reduction of overall exports to the UK as the onward trade from the UK to EU markets grinds to a halt. Read more “Fundamental Restructuring of Supply Chains Increasingly Needed in Absence of Progress in EU/UK Discussions on the Implementation of Necessary Border Controls”
Kenya Looking to Market Diversifications in Face of Growing Complications on EU Markets and Covid-19 Related Increases in Air Freight Costs
Summary
The Kenyan authorities are once again looking to promote a diversification of exports towards non-EU markets, in the face of stricter EU SPS import controls and ongoing impact of Covid-19 related freight disruptions, which have increased the costs of serving EU market. These increased costs are likely to remain for some time, leaving little scope for investments in developing high value alternative non-EU markets for horticultural exports. If such investments are not made any shift to non-traditional markets is likely to reverse once Covid-19 disruptions are overcome. With UK and EU phytosanitary requirements beginning to diverge, new opportunities could open up in a traditional non-EU market, the UK. The ability of Kenyan exporters to exploit these opportunities will be critically determined by the evolution of freight rates to the UK. Read more “Kenya Looking to Market Diversifications in Face of Growing Complications on EU Markets and Covid-19 Related Increases in Air Freight Costs”
Lack of Clarity on the Whether Brexit Disruptions of EU/UK Trade in Plants in Impacting ACP Exports
Summary
The early introduction of ‘complex and lengthy pre-notifications, certificates and inspections’ for living plants and cutting crossing from the EU to the UK is impacting on the EU/UK trade in such products. Currently it is unclear what knock-on effects this is having on ACP exports to the EU, given the large proportion of imports which originate in AC countries and the central role the Netherlands plays in the import and re-export trade. Given the impasse in EU/UK trade relations around the Northern Ireland Protocol, the early conclusion of a substantive EU/UK ^phytosanitary agreement is unlikely. The scope for shifting over to ACP direct exports to the UK meanwhile is complicated by the commercial consequences of the UK’s Covid-19 linked ‘red-list’ travel restrictions which are raising air freight costs from East Africa to the UK. Read more “Lack of Clarity on the Whether Brexit Disruptions of EU/UK Trade in Plants in Impacting ACP Exports”
EU Phytosanitary Regulations at the Forefront of Challenge Facing Kenyan Cut Flower Industry
Summary
The Kenyan cut flower sector has identified three major challenges currently faced: EU plant health regulations, freight costs and domestic Kenyan taxation. Of these, EU plant health regulations is seen as the most serious challenge since this relates to the accessibility of the all-important EU market. While there is no alternative to meeting EU requirements for access to the EU market, there is now scope for divergence in UK plant health regulations from inherited EU requirements. This could offer market alternatives for ACP cut flower exporters unable to verifiably meet EU requirements. This would appear to add urgency to expanding direct exports to the UK market, particularly since this would side-step the increased costs faced along triangular supply chains. However, Covid-19 linked airfreight disruptions greatly complicate such routing adjustments, with these new trading realities needing to be built into post-Covid air freight recovery plans. Read more “EU Phytosanitary Regulations at the Forefront of Challenge Facing Kenyan Cut Flower Industry”
EC Urged to Ensure Greater Reciprocity in SPS Protocols and More Effective Enforcement
Summary
Freshfel Europe has called for the EC and member states to develop ‘a concrete EU SPS strategy’ to improve access for EU fruit and vegetable exporters to 3rd country markets. ACP governments will need to take a nuanced approach to such overtures, paying careful attention to the practical operational policy implications of any commitments entered into, especially in regard to the possible impact on their relations with other major third country trading partners and regional trade integration initiatives. Read more “EC Urged to Ensure Greater Reciprocity in SPS Protocols and More Effective Enforcement”
UK Relaxation of Citrus Sector Phytosanitary Requirement Comes as Relief in Face of Mounting Spanish Citrus Producer Pressures, but Not Without its Complications
Summary
Spanish citrus producers continue to push for stricter phytosanitary controls on imports from Southern Africa. It is unclear whether this is driven by genuine phytosanitary concerns or commercial concerns. The increased commercial threat facing Spanish producers comes from Egyptian exporters, rather than Southern African suppliers, while the principal phytosanitary threat comes from Turkey. Despite this situation, Spanish citrus industry concerns may be taken up forcefully under the EU-SADC EPA review, given the other agri-food sector dispute the EU has with the SADC EPA region (e.g., in regard to safeguard restrictions on poultry meat imports from the EU). While Southern African citrus exporters see Brexit as an opportunity, given more relaxed UK phytosanitary import requirements, this will be at the cost of increased rules of origin and phytosanitary control complications along triangular supply chains (both EU to UK and UK to Ireland). These complications may require a restructuring of some routes to market used by Southern African citrus exporters serving UK and Irish markets. Read more “UK Relaxation of Citrus Sector Phytosanitary Requirement Comes as Relief in Face of Mounting Spanish Citrus Producer Pressures, but Not Without its Complications”
Implications of the Veterinary Constraint on UK Export Health Certification
Summary
UK trade related veterinary inspection and certification services are facing serious problems of recruitment and retention as demand sours. There are calls for both a greater government role in the organisation and conduct of trade related veterinary inspection services and the establishment of para-professional veterinary support staff for the conduct of trade related inspection and certification activities. However, unless changes designed to address staffing constraints are introduced in close consultation with trade partners such changes could disrupt trade, creating a dual system of EU and non-EU accepted health certification. While there are also calls for new UK electronic EHC systems which are compatible with EU systems and for the UK to negotiate a veterinarian equivalency agreement with the EU, the current political atmosphere and evolving situation on the ground are not conducive to early progress in these areas. This could potentially give rise to UK export surges of livestock products to ACP countries and even EU export surges to ACP countries, if the UK enforces equivalent controls on imports from the EU, to avoid undermining the competitive position of UK livestock product producers. Read more “Implications of the Veterinary Constraint on UK Export Health Certification”
Post Brexit Problems in UK Meat Exports to the EU and Implications for UK Poultry Meat exports to ACP Countries
Summary
UK meat exports to the EU are down 50% in the first six weeks of 2021, with the decline in poultry meat being initially most pronounced. In the long term it is expected UK exports will be down between 230% and 50% depending on the product and size of the exporting enterprises. Particularly in the poultry meat sector this could lead to a surge in exports to non-EU markets, with African and Caribbean markets for frozen poultry parts likely to be targeted. This could easily double current levels of UK exports to targeted African and Caribbean markets. The eventual level of UK trade diversion in the poultry sector will be determined by the nature of the controls placed on mainland UK to Northern Ireland poultry trade. Read more “Post Brexit Problems in UK Meat Exports to the EU and Implications for UK Poultry Meat exports to ACP Countries”