EU US Trade Deal Presents Further Challenges for Irish Farm Families

IFA President Francie Gorman said the proposed EU-US trade agreement will present further challenges to Irish farm families. Yesterday, a trade agreement between the EU and US was announced which will see a 15% import duty imposed on the majority of EU exports into the US.

“While the proposed tariff rate of 15% is lower than the threatened 30% rate, it still represents a significant challenge for the Irish agri sector on a number of fronts. We are still awaiting the finer details of the agreement, but given Ireland’s reliance on the US market, both in agriculture and beyond, its impact will be significant on Irish farm families, both directly and indirectly.”

Ireland exported circa €1.9bn worth of food and drink products into the US market in 2024. It is an important outlet and accounts for circa 11% of our total food and drink exports. Within the €1.9bn figure, dairy at €830m and drinks, predominantly whiskey, at €900m account for 91% of what we export. We also export pigmeat (€23m), beef (€8.8m) and seafood (€3.8m).

“Prior to the introduction of tariffs by the Trump administration in April, Irish butter was subject to a tariff rate of about 16%. Initial reports indicate that the proposed new 15% tariff rate will be a replacement for existing tariffs and will not be ‘stacked’ on existing tariffs. Should this be the case, it would reduce the impact of the proposed new tariffs on the Irish dairy sector significantly,” outlined the IFA President.

It is currently unclear what level of tariff will be imposed on other products such as Irish whiskey and liqueurs where a 15% tariff rate would be quite challenging given they previously operated on the basis of zero tariffs.

“The trade deal will create many other indirect challenges as well. The UK, which struck a 10% tariff deal, now benefits from a lower tariff than Ireland making them more competitive in the US market compared to Irish goods. It also means a differential tariff between exports north and south of the border. Furthermore, many farm households rely on employment from US multinationals which may also be negatively impacted by these new tariffs.

“From an Irish and European farmer perspective, the cost of any additional tariffs will ultimately be borne by the primary producer. It’s against the backdrop of a potentially devastating Mercusor trade deal along with plans to massively cut the EU CAP budget. Yet again we are left with the potential for farmers to be the fall guys on the back of EU trade and policy developments,” concluded Mr Gorman.