Market Morsel: Europe setting up for import bans.

Market Morsel

At EP3, we have warned in the past, here and on the AgWatchers podcast, about the policy from Europe being a risk for trade.

The EU Green Deal, and specifically the Farm to Fork strategy, has the potential to exacerbate food inflation and cause significant food security issues, and this new policy is in exactly the same vein.

This week, the EU will release the Vision for Agriculture and Food, which will set huge swathes for agricultural policy in one of the world’s largest trading blocs.

There is one thing that is of most concern to Australian farmers. The potential for import barriers.

The EU is fairly restrictive on things like animal welfare and chemicals. So, let’s say the EU bans a chemical, which potentially makes their farmers less competitive and have lower yields.

Many farmers argue that the government shouldn’t tie them up in green tape, and then export the productivity to other nations.

So, this draft policy would see products produced using chemicals banned in Europe not being allowed to be imported into Europe. We are heavily reliant on Europe for our trade in canola, more so than we are with barley into China. If they ban a chemical we need, then we are screwed.

The same will apply to animal welfare practices. An obvious animal welfare practice would be mulesing; whilst it is not banned in Europe, pain relief is mandatory, which is not the case in Australia.

A large part of this policy is about placating farmers who have been frustrated by EU policy over recent years. They want to make sure that their farmers, who are potentially facing challenging production due to a lack of chemistry, are not disadvantaged compared to other nations.

This is green diplomacy, and it will have an impact on Aussie ag.

(An excerpt of the leaked document is displayed below)