NFU ignoring their own report

Press Release
21/4/16

NFU ignoring their own report

UKIP candidate for Mid Ulster says NFU ignoring their own report

Alan Day stated “It seems that the NFU has largely ignored their own report. The NFU funded report prepared by economists from Wageningen modelled the farm income effects of three possible trade arrangements that might follow Brexit.

Under a Free Trade Arrangement with the EU, the economists concluded that most farm commodity prices would be improved by 5% (though only by 2% for sheep meat).

In the absence of FTA, the UK Government can apply tariffs to imports at a maximum rate which is set by the World Trade Organisation (WTO). Under this option prices were forecast to rise for all commodities by between 7% (the lowest increase was for eggs) and 11% (the highest increase was for sugar).

In the report’s words: “Price changes due to a Brexit have a positive impact on farm incomes in all sectors under the FTA and WTO-default scenario.”

Lastly the study looked at UK Trade Liberalisation, a scenario based on halving import tariffs. It reports that under this option:

“the UK will see an increase in the producer prices of its main arable crops (except for sugar) and to a lesser extent also for most dairy products, while the prices of sugar and all types of meat will show a net decline.”

The paper then examines the effects of different levels of subsidies byt he UK government – the status quo, a 50% reduction of direct payments and no direct payments. Not surprisingly, the authors discover that lowering direct payments decreases profitability.

Brexit would allow farmers to do better if the Government continues with the current level of area payments and the Government would be better off too. The UK currently contributes an estimated €7.9bn to the CAP budget, from which its farmers receive €3.8bn. The current level of area payments can be retained with a saving of €4.1bn.

“A Brexit would save the UK budget expenditure on agriculture”

Not only this, but it is a certainty that the EU will cut CAP funding in the future which will adversely affect farming incomes.

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