Proposals for a temporary customs union with the European Union when Britain’s membership ends have been welcomed by the agricultural industry.
Farmers and growers need the stability that would come with continued trade between the UK and the EU within a customs union, the National Farmers’ Union (NFU) said.
Such an arrangement would avoid a possible Brexit cliff edge in March 2019 of trade tariffs being charged on UK exports to countries within the EU bloc.
Seventy-five per cent of the nation’s agriculture exports are sold to the EU, including 38 per cent of UK lamb.
The Government has this week set out plans to seek time-limited temporary customs arrangements to come into force after the withdrawal from the EU, which will be similar to the current regime.
The UK would not be able enact free trade deals during the interim,but Brexit Secretary David Davis said he believes it will be able to negotiate them during this period.
A Customs Bill is set to be brought forward in the autumn to ensure a new regime is in place by exit date. Countryside campaigners said they are keen to see the precise details of any future agreements.
Dr Charles Trotman, senior business and economics adviser at the Country Land and Business Association (CLA), said: “The CLA, along with other farming organisations, has called for a transitional deal that maintains free and frictionless trade in agri-food products extending beyond the end of the Article 50 process.
“On the face of the Government’s proposal to introduce a temporary customs union, it seems that the agricultural sector’s need for continued access to, and trading in the union is recognised.
“However, the devil is invariably in the detail, and in this particular negotiation process, it takes infinitely more than two to tango. We welcome this initial proposal, but further clarity is needed on the interim and long-term customs arrangements to sustain a transitional agreement on continued free trade.”
Dr Trotman added: “We would also encourage the Government to explore alternative arrangements that support farming and the environment by avoiding an abrupt end to our existing trade arrangements with the EU.”
The NFU’s president, Meurig Raymond, who held talks with the Chancellor, Philip Hammond at Chertsey Show in Surrey last weekend, said: “It is pleasing to see Government recognise the concerns of the sector.
“In recent discussions with the Chancellor, the NFU reinforced the need for a transitional arrangement post-Brexit that sees the UK and EU continuing to trade within a customs union, and I’m pleased to see the Government appear to accept this as the best way forward.
“Such an arrangement would provide farmers and growers with the stability and continuity needed to continue running competitive and profitable farming businesses.
“It is crucial that swift progress is made on the current phase of Brexit negotiations so the crucial issue of the UK’s future trading relationship with the EU, including the precise nature of both the interim and long-term customs agreements, can be discussed as soon as possible.”
Meanwhile, the Tenant Farmers Association is calling on farm landlords to consider the uncertainty facing farmers around the Brexit process. The association’s chief executive, George Dunn, believes there can be no justification for farm rent increases this autumn.
“We are beginning to see an alarming number of cases where landlords are seeking to raise farm rents particularly on tenancies let as Farm Business Tenancies which have open market rent formulas,” Mr Dunn said.
“There is so much uncertainty at the moment, not least in relation to Brexit. Both landlords and tenants would be better off in agreeing sufficiently long enough tenancy terms building in rent reviews after Brexit in order to adjust matters in a more certain environment in relation to trade, Government policy, regulation and access to labour.
“What we really need at this time is an element of stability to be available when all else seems to be at sea.”
He added: “Rather than spending tens of thousands of pounds in professional fees in arguing over the level of rent, it would be better if landlords and tenants sat down to agree a longer term strategy which incorporates Brexit at rent levels which give both a return to the landlord and the ability for the tenant to make a reasonable living.”
Michaelmas, which falls on September 29, is when most rents are reviewed following review notices served at least 12 months earlier.