Since a 2016 referendum in Great Britain, markets around the world have wondered if the country’s decision to leave the European Union (EU) would open up an opportunity for trade. The United Kingdom (U.K.) is a net importer of dairy products, so at first glance, “Brexit” appears as a ripe opportunity for dairy exporters.
The panel on the October 7 Hoard’s Dairyman DairyLivestream suggested not putting all of your trading eggs into this basket. As they described, many decisions would have to align for enough access to be opened.
“The U.K. is a net food importer; that sounds like an opportunity for us,” said Cornell’s Andy Novakovic. “If I’m a UK dairy farmer, that sounds like a threat. I can tell you that farmers in the U.K., and dairy farmers in particular, are not feeling super happy about how all this is evolving and not at all certain about how they are going to come out.”
That concern and the geographically indicated (GI) cheeses that are marketed by the country may keep trading doors firmly closed.
“It’s going to really boil down to what kind of agreement they have with the EU, what are they able to do elsewhere, and if they do something elsewhere, is Europe going to punish them even though they don’t have an agreement,” the seasoned dairy economist explained. “It all gets kind of complicated in terms of assessing just how much of an opportunity we might have.”
National Milk Producer Federation’s Jaime Castaneda echoed those thoughts. He is the senior vice president of policy and international trade for the organization. “We are negotiating a free trade agreement with the U.K., but the U.K. is also still negotiating its terms of Brexit with the EU. At the end of the day, it depends on what kind of agreement the U.K. will have with the EU regarding GIs,” he explained.
An ongoing series of events
DairyLivestream will air twice each month for the remainder of this year. The next broadcast “Dairy remains a powerhouse” will be on Wednesday, October 21. Each episode is designed for panelists to answer over 30 minutes of audience questions. If you haven’t joined a DairyLivestream broadcast yet, register here. Registering once registers you for all future events.