The post-Brexit era opened in January with a slump in the agri-food trade of 11% compared to the same month last year, according to data released by the European Commission.
After a long period of continuous growth, the EU experienced a sharp fall in agri-food exports, mostly due to a €800-million contraction in the value of products sold to the UK, according to the Commission’s monthly trade report released on Thursday (6 May).
Year-on-year, the EU’s agri-food exports fell by 24% in January and by 32% compared with the previous month of December.
The value of imports from the UK also plummeted by 67%, with a loss of €874 million, with the decline in the volume of trade felt across all categories of agri-food products.
The decrease in trade with Britain follows the end of the transition period in December 2020 after the UK’s official departure from the EU earlier that year.
Overall, the EU’s overall agri-food trade with all partners fell by 11% year-on-year to €13.5 billion, with the biggest losses in export value seen in wine (€188 million), infant food (€142 million), preparations of vegetables and fruit (€89 million), and chocolate and confectionery (€79 million).
The UK has now unsurprisingly shot to the top of the list of destinations for the EU’s agri-food exports, with a trade value four times bigger than the second-largest importer of EU foodstuffs, the US.
According to Joao Pacheco, a senior fellow at the think tank Farm Europe, this figure in the first month of actual post-Brexit trade suggested a disproportionately negative impact of the UK’s departure in both EU exports and imports. However, he said it might be too early to tell.
“Although we expect a negative trade impact of Brexit, we should wait a few more months before assessing its real scope,” he told EURACTIV.
Falls were also recorded in the value of exports to the US (down by €254 million), Russia (€110 million), Japan (€66 million), and Saudi Arabia (€62 million).
The situation is expected to improve with the end of the aircraft subsidies row that has soured transatlantic relations in recent years and led to the US and EU imposing reciprocal tariffs on agri-food products.
The Commission’s trade outlook also shows that European agriculture has been hit hard by the COVID-19 pandemic, despite the EU’s efforts to prevent it, according to the German conservative MEP Norbert Lins.
“Together with the necessary environmental and climate measures, we also need to focus on our role in global food security in the Common Agricultural Policy (CAP) reform,” said the lawmaker, who is the chair of the European Parliament’s agriculture committee.
[Edited by Josie Le Blond]