Summary
While Spanish citrus producers continue to press for safeguard measures against imports of citrus fruit from South Africa, EU data suggests the growth of imports from morocco and Egypt has been more significant than the growth in imports from South Africa. Furthermore EU data suggests declines in both EU citrus consumption and EU exports have had a far greater market effect than any increase in import volumes. EU data also suggests the current citrus market difficulties are specific to Spain, the only EU country where citrus prices are below the 5 year average. This strongly suggests that rather than restrictions on imports from South Africa, national action is required to strengthen the functioning of the citrus supply chains and eliminate unfair trading practices along citrus supply chains. Read more “Spanish Pressure for Application of Safeguards Against Imports of South Africa Citrus Fruit Increase Despite Evidence of National Nature of the Current Citrus Market Crisis”
CBS Control Challenge Yields Benefits for False Codling Moth Controls
Summary
The development of a systems based approach to pest and disease control for CBS is yielding benefits in terms of South African controls of False Codling Moth (FCM). EU FCM interceptions on imports from South Africa were down in 2018, with a far lower level of interceptions than other ACP exporters despite South Africa’s far higher volume of exports to the EU of potentially infected products. Calls for a ‘white list’ approach to FCM related import controls if adopted by the EU could free up scarce pest control resources for deployment in the most vulnerable areas. However development assistance support will be required to ensure small scale producers are not commercially disadvantaged by any moves over to a ‘white list’ approach. Given South Africa’s successful experience there would appear to be scope for the sharing of best pest-control practices across ACP exporters of vulnerable products. Read more “CBS Control Challenge Yields Benefits for False Codling Moth Controls”
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”
MHP Looking to Africa as Part of its On-Going Expansion Outside of Ukraine
Summary
Following its expansion into the EU the Ukrainian poultry producer MHP is looking to expand in Africa and the Middle East. This needs to be seen in the context of a projected 15% expansion of MHPs exports in 2019 and a further planned production expansion of 15% in 2019. This expanded production will need to be exported. Current Ukrainian exports are facing growing criticism from EU poultry producers because of their market effects in the EU. These criticisms are only likely to intensify in the event of a ‘no-deal’ Brexit. This could leave MHP seeking markets elsewhere, including in African countries where acquisitions are being targeted. This could then replicate the MHP practice of using locally acquired poultry processors to channel Ukrainian poultry meat on to the local market. African poultry producers and concerned African governments will need to carefully monitor the evolution of MHPs’ African investment policy. Read more “MHP Looking to Africa as Part of its On-Going Expansion Outside of Ukraine”
Increased Levels of Pest Interception in Uganda Leads to Pre-Emptive Export Ban
Summary
In April 2019 the government of Uganda introduced a self-imposed ban on exports of sub-standard vegetables to Europe. This needs to be seen in the context of the stricter application of EU SPS controls. This includes controls for False Codling Moth (FCM) which was designated as a ‘quarantine pest’ by the EU from 1st January 2018. This saw 2/3 of all EU SPS interceptions of Ugandan exports arising from FCM infestations in 2018. Despite the four-fold increase in the value of Ugandan floriculture and horticulture exports to the EU since 2010, serious questions arise as to the commercial sustainability of attaining conformity with EU SPS requirements. Experience in South Africa highlights how costly establishing a comprehensive system based approach to SPS controls can be. Even where export values are more than 10 times those attained by Ugandan exporters this can prove commercially challenging. Critical to enhancing the effectiveness and reducing the unit cost of SPS control measures will be improved organisation of private sector producers and improved public/private sector cooperation in ensuring compliance with EU SPS requirements. Read more “Increased Levels of Pest Interception in Uganda Leads to Pre-Emptive Export Ban”
EU Production Growth Impacts on Both Profitability of EU Sugar Companies and ACP exports to the EU in 2018
Summary
The expansion of EU sugar production in addition to reducing the volume and value of ACP sugar exports has also undermined the profitability of EU sugar beet processing companies, with major operators such as Suedzucker looking to shut some processing plants in response to low EU sugar prices. In 2017/2018 regional EU sugar price trends in part correlated with trends in sugar production, with price falls being most dramatic in areas where the production increase was greatest. Meanwhile voluntary coupled support has held back the geographical redistribution of EU sugar production. Some ACP exporters remain dependent on the UK market while others have diversified, targeting sugar deficit regions of the EU where sugar prices have held up better. Longer term trends in EU sugar consumption do not bode well for traditional ACP sugar exporters. Brexit uncertainties will need to be taken on-board in the marketing decisions of ACP sugar exporters in the 2019/20 marketing year, with various Brexit scenarios being explored and export markets to be targeted identified accordingly. Read more “EU Production Growth Impacts on Both Profitability of EU Sugar Companies and ACP exports to the EU in 2018”
ACP Livestock Sectors and the Collapse of Cross Party Talks to Resolve the Brexit Impasse
Summary
The breakdown of cross party discussions on a compromise to break the Parliamentary impasse on ratification of the EU/UK Withdrawal Agreement is seeing renewed efforts to remove Prime Minister May from office. There are concerns this is increasing the prospect of a ‘no-deal’ Brexit. This would seriously impact on EU27/UK trade in livestock products. The resulting EU/UK trade displacement could lead to import surges which could disrupt ACP markets and undermine the position of local livestock producers in ACP countries targeted by EU/UK exporters. Actual effects will need to be assessed country by country and product by product. ACP governments in countries where livestock based agro-food industries are under development should review the safeguard mechanisms they have available to protect local livestock producers from the trade displacement effects of a ‘no-deal’ Brexit. ACP beef, dairy and poultry companies and producers associations should review their marketing strategies and develop contingency plans to deal with the commercial consequences of the trade displacement effects of a ‘no-deal’ Brexit. Read more “ACP Livestock Sectors and the Collapse of Cross Party Talks to Resolve the Brexit Impasse”
What Issues Arise in Relations with Developing Countries From the EU’s 2020 CAP Reform Proposals?
Summary
While the paper from Professor Mathew’s paper reviews the possible effects of specific CAP reform proposals, these cannot be assessed in isolation from the wider EU CAP related policies. This includes EU agricultural trade policies and EU SPS and food safety policies. There are inherent tensions between the quest by EU agro-food companies for new markets and African aspirations for the structural development of local agro-food sectors. Reconciling this tension in a development friendly manner will be a key challenge in addressing policy coherence issues which arise as a result of the EU’s Common Agricultural policy and associated supporting policy measures. Any attempt to get to grips with this issue will require engagement at the country and product specific level and will require full respect for the right of ACP governments’ to determine trade policy measures in all sovereignty on the basis of national structural development interests. This will de facto require the EU to respect the ‘right to development’ of ACP countries by subordinating the interpretation and application of trade agreement commitments to the structural development interests of ACP countries, as defined by the governments and concerned stakeholders in ACP countries Read more “What Issues Arise in Relations with Developing Countries From the EU’s 2020 CAP Reform Proposals?”
Impact of Yellow Vest Protests on Cameroonian Pineapple Exports Highlights Importance of Tackling UTPs along ACP-EU Supply Chains in Context of Potential ‘No-Deal Brexit’
Summary
Commercial arrangements for Cameroonian pineapple exports to France highlight the importance of business practices to burden sharing at times of trade disruptions. Massive losses for Cameroonian exporters have a risen as a result of the ‘yellow vest’ protests disrupting the delivery of exported pineapples to supermarkets, in a context of the absence of formal contractual arrangements along the supply chain. This raises important issues related to the application of the EU’s new UTP directive given the prospect for the severe disruption of ACP-UK triangular supply chains under a no-deal outcome to the ongoing EU-UK negotiations. This suggests a need for the concerned ACP governments to lobby for the accelerated implementation of the new UTP directive in the EU member states most directly involved in these triangular trade arrangements (Belgium, the Netherlands, France and Germany). It also suggests a need for the establishment of a special monitoring unit to trace Brexit related unfair trading practices which emerge under a no-deal Brexit scenario. However this would only be of value if ACP exporters in future insist on written contracts before entering into supply agreements with EU importers. Read more “Impact of Yellow Vest Protests on Cameroonian Pineapple Exports Highlights Importance of Tackling UTPs along ACP-EU Supply Chains in Context of Potential ‘No-Deal Brexit’”
Task Force for Rural Africa Sets Out Four Strategic Areas and Six Initiatives
Summary
The Task Force Rural Africa (TFRA) advances a series of specific recommendations and initiatives aimed at ensuring African agro-food sector development contributes fully to addressing the employment and income earning opportunities challenge faced in Africa. A critical challenge is seen as promoting an appropriate trajectory for ‘the development of the African food industry and food markets’. However this will need to address the tension between the EU’s quest for new food product markets and African aspirations for the structural development of national agro-food sectors. In some sectors this will require a critical review of current patterns of trade and investment relations (e.g. in the dairy sector). TFRA recommendation on structured policy dialogues could prove valuable in this regard. A key issue to be addressed will be the interpretation and application of existing EU-Africa trade agreement commitments, which go beyond WTO rules and undermine national trade policy sovereignty and the effectiveness of chosen policy measures. It will also need to effectively operationalize the EU’s new unfair trading practices directive as this impacts Africa-EU trade flows and support measures to strengthen the functioning of local agro-food sector supply chains. Read more “Task Force for Rural Africa Sets Out Four Strategic Areas and Six Initiatives”