Post-Brexit UK trade deals could bring opportunities for New Zealand beef exporters, according to a new report by Rabobank.
Although the UK is a relatively small market for New Zealand beef, it is high-value, meaning Kiwi producers will be keeping a "close watch" on future export opportunities, says Blake Holgate, Rabobank animal proteins analyst and co-author of the latest Beef Quarterly report.
Holgate said trade negotiations between the UK and EU were intensifying, with more rounds of negotiations being held through to early October.
He said the negotiations will determine who ultimately supplies the UK beef market, and could end up being beneficial for New Zealand exporters.
Currently, the UK gets 70 percent of its beef imports from Ireland, which Holgate says is "one of a select number of major beef exporters to the EU-27 who are granted tariff-rate quotas which allow them to import certain quantities of beef at reduced or zero tariff rates".
"Once the Brexit transition finishes, these quotas will be divided between the EU and the UK, affording existing EU suppliers access to the UK at reduced tariff rates. If however, the EU and the UK fail to agree on future trade terms, it's likely tariffs will remain high for most imported beef products and this would put Irish beef in a vulnerable position," Holgate said.
Depending on the result of those negotiations, as well as trade deals with non-EU countries, there could be a "possibility of broader low-tariff or no tariff access to the UK market for other beef exporters", such as New Zealand, Holgate said.
Although ongoing trade negotiations will be pivotal, the report also highlighted other factors as playing an important role in gaining market share, such as exporting countries' reputation for producing beef at the highest food safety, animal welfare and environmental standards. For this reason it was vital New Zealand maintained the highest standards, Holgate said.
“If the New Zealand beef industry is able to do this, it is likely to find itself in a privileged position compared to some of its competitors.
"However, if it's unable to maintain these standards, it could find it increasingly difficult to get product on UK supermarket shelves."
