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”
Brexit Begins to Seriously Impact of Re-Exports of ACP Products to Ireland via the UK
Summary
The border controls arising from the basis of the UK’s departure from the EU customs union and single market is profoundly disrupting the re-export of ACP fresh products to Ireland. While larger ACP exporters are able to adjust their routes to Irish markets to side-step the new border complications, smaller ACP exporters are simply losing orders. There are simple policy solutions which could be adopted to address the rules of origin/MFN tariff and phytosanitary complications now faced. Adopting such solutions is not only important in its own right but would offer a model for addressing the far more extensive disruptions to re-exports of ACP products to the UK which are likely to arise as full UK full border controls on good crossing from the EU are rolled out in 2022. Read more “Brexit Begins to Seriously Impact of Re-Exports of ACP Products to Ireland via the UK”
Lack of UK IT Systems for Organic Imports Poses Challenges for ACP Fresh Produce Exporters
Summary
The UK’s reversion to paper based organic product documentation is generating additional costs and value losses for ACP organic exporters. This takes the form of increased internal administrative costs and value losses resulting from misplaced or delayed documentation. These problems are particularly severe for small volume exports of mixed organic products. Bulk exports of single organic products are less severely affected, since additional costs are lower and there is less risk of document loss. Political relations between the EU and UK around Brexit related trade issues would appear to be such as to rule out any arrangements which might allow a temporary restoration of UK access to EU IT systems used for trade in organic products until such time as UK systems are fully in place. Read more “Lack of UK IT Systems for Organic Imports Poses Challenges for ACP Fresh Produce Exporters”
How Will Brexit Disruptions and a UK-Australia FTA Impact ACP beef exporters?
Summary
Given Brexit related uncertainties, since 2016 beef exporters in Namibia and Botswana have been diversifying away from the UK market in their trade with the EU28. In addition, Namibia has for many years been marketing its beef on the basis of its quality and natural production process. Given the Australian focus on serving the market for high quality cuts these product differentiation efforts should be continued, in order to insulate Namibian beef exports from commercial impact of a duty-free/quota-free UK-Australia trade agreement. While Botswana has now largely stopped exporting beef directly to the UK, it is unclear whether any onward trade via the Netherlands takes place. If the Botswanan beef sector in future intends to serve the UK market, then ‘quality’ based product differentiation marketing efforts will need to be intensified. Read more “How Will Brexit Disruptions and a UK-Australia FTA Impact ACP beef exporters?”
Brexit Costs Are Leading to a Restructuring of UK to EU Supply Chains
Summary
Brexit related cost increases are beginning give rise to a restructuring of supply chains to avoid crossing the UK/EU border. While analysis to date focusses on the impact on the UK livestock products sector, serious disruptions to ACP triangular supply chains for the delivery of fruit and vegetables to EU markets via the UK area also being impacted. This is in part a result of the phytosanitary certification and phytosanitary import control requirements not faced by re-exported ACP products. There is a need to take practical steps to address these phytosanitary related challenges, so as to avoid undermining export opportunities for a range of smaller ACP agri-food exporters. These exporters faced particular challenges because of the ‘thin’ nature of the EU/UK trade agreement, which has left important phytosanitary issues unaddressed. Read more “Brexit Costs Are Leading to a Restructuring of UK to EU Supply Chains”
EU Poultry Meat Exports to Sub-Saharan African Markets Surge at Beginning of 2021 Suggesting Trade Diversion is Underway
Summary
Trade diversion to ACP poultry markets, as a result of Brexit related disruptions to the EU/UK poultry trade appears to be underway. This situation of trade diversion is likely to get worse before it gets better, given full UK border controls on imports from the EU are only scheduled to be introduced in 2022. For those ACP countries seeking to develop their domestic poultry production on national food security grounds, this gives added importance to poultry sector trade policy. Here lessons can be drawn from South Africa’s current poultry sector trade policy review, which seeks to draw inspiration from EU policy practice in the poultry sector as opposed to EU policy prescriptions. EU trade protections in the poultry sector serves not only to protect the domestic EU market, but also support EU poultry meat exports. These low-priced EU exports of poultry parts are in turn serving to undermine efforts aimed at developing both domestic African poultry production (in response to heightened food security concerns) and intra-African trade in poultry meat. Read more “EU Poultry Meat Exports to Sub-Saharan African Markets Surge at Beginning of 2021 Suggesting Trade Diversion is Underway”
How Will EU Sustainability and Livelihood Due Diligence Regulations Interface with Private Sector Sustainability Initiatives?
Summary
In response to growing consumer pressure and pending regulatory initiatives, FMCG companies are updating their policies and seeking out innovative solutions to enhance the effectiveness of efforts to halt deforestation, promote sustainable farming practices, enhance livelihoods opportunities, and improve working conditions. This is an ambitious agenda which will need to get to grips with the twin questions related to: who bears the costs of the required innovations and how will this affect the distribution of revenues to different actors in the supply chain. To date the necessary search for technical solutions has seen these core questions set to one side. However, as mandatory ‘due diligence’ requirements come ever closer, it is increasingly important that these twin questions are systematically addressed. Read more “How Will EU Sustainability and Livelihood Due Diligence Regulations Interface with Private Sector Sustainability Initiatives?”
Deadline for Transposition of EU UTP Regulation into National Law Passes but Major Questions Related to UTPs Remain
Summary
The EU UTPS regulation has not been transposed into member states national law, but with uneven results. Ensuring common standards of enforcement to uphold minimum EU requirements for removing UTPS in agri-food supply chins is no essential. Equally there is an urgent need to ensure enforcement mechanisms recognise the realities of ACP-to-EU supply chains and actively prevent the adoption of commercial practices between importers and exporters which de facto circumvent the intention of EU UTP regulations in regard to 3rd country-EU supply chains. Read more “Deadline for Transposition of EU UTP Regulation into National Law Passes but Major Questions Related to UTPs Remain”
ACP Mango Exporters Hoping for a Good 2021 Season in Face of Ongoing Covid-19 Disruptions and New Brexit Complications
Summary
The poor 2020 West African mango export season had as much to do with the impact of Covid on freight options as it di with demand suppression. Having flexibility in the routes to markets served is therefore of considerable importance in adjusting to the evolving economic effects of the Covid-19 pandemic in the mango sector. In this context Brexit related complications arising for mangoes onward traded across EU/UK borders narrows the freight options open to some ACP mango exporters, with this compounding and already difficult situation. Read more “ACP Mango Exporters Hoping for a Good 2021 Season in Face of Ongoing Covid-19 Disruptions and New Brexit Complications”
The Sea Freight Reefer Constraint on ACP Perishable Exports Compounds Brexit Complications
Summary
A shortage of refrigerated containers, and an in-balance in their geographical distribution is seeing raising reefer freight costs and a rescheduling of shipping services to seek to address the in-balance. This could potentially carry costs for smaller ACP exporters of perishable product exports to Europe. This situation is complicating efforts to deal with cost increasing effects of the rules of origin/MFN tariff complication and phytosanitary certification requirements for perishable products shipped along triangular supply chains, through re-routing such to direct shipment to either the UK or EU market. Read more “The Sea Freight Reefer Constraint on ACP Perishable Exports Compounds Brexit Complications”