AHDB report sheds light on future food trade with the US

New analysis highlights the risks and the opportunities a new trade deal with the US may bring for UK food and farming.

The latest Horizon report from AHDB looks in detail at a potential transatlantic deal, providing independent, evidence-based analysis of the likely implications for producers, consumers and the wider agri-food sector.The report entitled  ‘A US/UK Free Trade Agreement and its impact on UK Agriculture’ released today assesses a range of evidence to answer questions about the future trading relationship, including current production and trade patterns, comparative costs and methods of production, previous trade agreements, agricultural policy and expert insight from businesses already exporting to the US.

Among its findings are that while standards may be used as a barrier to trade, the media speculation about the UK being flooded with cheap US food produced to a lower standard is possibly misplaced. According to the report’s author, the US has the capability to set up supply chains to meet a variety of standards and already does so for a number of markets across the globe and domestically, allowing it to meet various requirements to certain markets, if it is economical.

And with existing deals and established trading relationships in high-value markets closer to home, the UK is not likely to be immediately attractive to US exporters. However, a deal could provide an export opportunity for niche UK products which have a point of difference in the US marketplace and satisfy consumer demand for quality and consistency.  

The US is already an important market for UK food, with products such as cheese, butter and whisky on the supermarket shelves across the pond. In September last year, the first shipments of British beef for 24 years landed on US shores, in a deal estimated to be worth £66 million over five years.

Tom Forshaw, AHDB senior policy analyst and report author said: “The US is a global agricultural powerhouse and a trade deal will improve access to the UK market, so we need to be conscious of what’s potentially coming. It is also a market of 330 million relatively affluent consumers and that gives us an opportunity.

“It is unlikely that in the short term a deal with the US is going to mean a flood of US product hitting our shelves. This is both because of the nature of trade deals, which take time to implement over 10-15 years but also because of the economics of trading. In many sectors, the US already has seasoned markets, with products that are traded at a higher price than we currently import here.

“But UK farmers can’t afford to be complacent and need to ensure they are well placed to be competitive in future.”

Tom added that the UK is entering a new era of trade policy and the latest Horizon report sets the scene for deals we are currently negotiating with other major agri-food exporters, such as Australia, New Zealand and Canada. For more trade and policy news and analysis, visit ahdb.org.uk/eu-exit

 

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About The Author

John Swire - Editor of Agronomist and Arable Farmer as well as responsibility for the Agronomist and Arable Farmer and Farm Business websites. After 17 years milking cows on the family farm John started writing about agriculture in 1998 and has since written for a variety of publications and has developed a wide circle of contacts within the industry. When not working John is a season ticket holder at Stoke City and also of late has become a fitness freak, listing cycling, swimming and walking as his exercises of choice.