Scottish sheep farms will be worst hit by the UK’s post-Brexit free trade agreements (FTAs), new research has shown.
The Scottish government has assessed the impact on Scottish agriculture of FTAs between the UK and Australia, New Zealand, Canada and the Gulf Cooperation Council.
Results showed that while the projected long-term impact of FTAs on Scottish output in relatively small in most cases, sheepmeat is an exception.
Scottish sheepmeat output with the FTAs is projected to fall by 10.5-11% under the two scenarios the government used for its assessment.
According to the report, the FTAs with Australia and New Zealand are the main drivers of declines in Scottish sheepmeat output.
Beef and wheat are also projected to fall (both by around 3% to 6% depending on the scenario), although the report added that a trade deal with Canada is likely to generate export opportunities for Scotch beef.
Liquid milk output is forecast to grow however, by 3-9% in value terms, indicating that the FTA will bring significant opportunities for dairy products.
The report also showed that the FTAs will result is “significant” farm business income declines, and price declines are the main drivers for this, with Brexit only playing a minor role. The impact of FTAs on wages is expected to be minimal.
Scottish Rural Affairs Secretary Mairi Gougeon said the report shows that the current UK government trade approach is “not working in the interest of Scottish agriculture”.
“The report also reaffirms that such FTAs will set important precedents to other prospective trade partners about where the UK is willing to cede in negotiations,” she said.
“These could weaken its bargaining position in future deals and lead to worse outcomes for those sectors already negatively affected – especially in terms of renowned brands like Scotch beef and lamb.
“We will use these findings to help identify future policy options to mitigate or address the differential impacts of trade, as part of delivering Scotland’s Vision for Trade.”
