National Sheep Association – Supplementary Written Evidence (JTN0044)

1. How is the UK-Japan agreement likely to impact you or your organisation or sector?

1. The prospect of our lamb exports being seriously disrupted upon our exit from the EU is high and until new trade agreements are established, the risk intensifies. As with any new trade deals, NSA would expect the Government to fully consider the implications on our own domestic sheep industry before diving in.
2. NSA does not see a trade deal with Japan as a risk to the UK sheep sector, and on the contrary can see many positive benefits for sheep producers and exporters in the UK to sell lamb to Japan. Japan relies on imports of sheepmeat to supply its domestic demand so creating opportunities can only be a positive as it opens up an additional market for British exports. The UK currently exports a very limited amount of sheepmeat to Japan. There is some moderate opportunity for UK exports of sheepmeat and NSA believes it would be a positive to expand that where possible. At this time, the UK doesn’t have a specific TRQ for sheep meat with Japan and the new deal allows access to the ‘unused’ EU quota. NSA would embrace a specific TRQ in the future, once efficient supply chains have been established. On the surface the UK-Japan trade deal is welcomed by the sheep industry, opening new export opportunities and destinations.

2. How does the UK-Japan agreement differ from the EU-Japan Economic Partnership Agreement? How might those differences impact you?

3. NSA welcomes the new protection for more iconic UK goods under UK-Japan CEPA, with the aim to increase geographical indications (GIs) from just seven under the terms of the previous agreement to over 70, which would lead to improved recognition of key UK brands in the Japanese market.  We would be very keen to see Welsh lamb, West Country lamb and Scot lamb included as recognised GI’s as soon as possible.
4. NSA supports the introduction of ‘Animal Welfare Technical Working Group’ to exchange information, expertise and experiences in the field of animal welfare. We support the specific ‘focus on farmed animals with a view to improving the mutual understanding of our respective laws and regulations’. UK farmers work to some of the highest animal health and welfare standards across the globe. Nothing in the CEPA prevents the UK from continuing to uphold its’ high environmental, food safety and animal welfare standards. Despite confirmation that provisions in the UK-Japan deal commit both parties to cooperate on matters of “animal welfare, and to exchange technical information and best practices for providing safe and high quality foods for consumer”; we wouldn’t want to see imports of lower standards of sheepmeat on our supermarket shelves undermining (and undercutting) our UK farmers hard work in achieving these standards. Of particular interest to NSA is Chapter 19 ‘cooperation in field of agriculture’ - allowing parties “to recognise that promoting trade in agricultural products and foods between them is in their mutual interest, and aim at promoting cooperation on sustainable agriculture, including rural development and the exchange of technical information and best practices for providing safe and high quality foods for consumers in the Parties”. This will hopefully ensure the UK high animal health and welfare standards are maintained and promoted across the globe.
5. “Agricultural goods qualifying as originating goods shall not be subject to any duties applied by the other Party pursuant to a special safeguard measure taken under the Agreement on Agriculture”. NSA appreciates reduced or even no tariffs in the new UK-Japan deal. Providing sheep meat and sheep products fall into this category, potential tariff barriers are removed. With regards to non-tariff barriers, the introduction of the ‘Low Rate Import Certificate; designed to reduce paperwork on British imports into Japan would impact our sector positively, allowing British sheep meat imports into Japan.  
6. We still have reservations over the changes to new and more liberal the Rules of Origin which remove certain restrictions contained in the previous agreement. NSA wouldn’t want to see the authenticity and value of UK sheep meat and sheep products, undermined by ‘substantial transformation’. Clarity is needed, especially on how this relates to sheepmeat and sheep meat products.

3. To what extent has the Government achieved its negotiating objectives?

7. Trading relationships with Japan, as with many countries, requires long term relationship building prior to trade agreements and certification processes. Our industry is enthusiastic to engage with this process, but it requires resources and investment that is not readily available through existing DIT/Defra funding streams. We need investment in market readiness, not just with Japan but many other countries we would not regularly trade with. I’m not aware that the Government has established this investment in readiness for this deal (and other deals) coming into effect from the 1st of January 2021.

4. How might the UK-Japan agreement impact the UK's economy - as a whole, for certain sectors, or for certain devolved nations and English regions?

8. Recognition of GI’s from devolved nations (as well as those in England) would increase productivity and improve future market access for high value, premium products.
9. Future changes in trade patterns for UK sheepmeat will need investment in knowledge, training and collaborative work across the supply chain. If trade does move away from the EU towards Asia, this will result in different product categories being exported to balancing carcase utilisation. The challenge of trading sheepmeat with Japan shouldn't be underestimated in terms of high expectations on traceability, food safety and different priorities to those in the western world. We would see there being a long-term opportunity in trading British sheepmeat in Japan and we can see emerging providence artisan foods in Japan. While the majority of the UK sheep export focus is on meat, it should also be recognised that there will be opportunities for other sheep related products including sheep dairy and wool and wool products.

6 November 2020