Live subsidies cut to the bone
MARKET managers in Brussels have imposed deep cuts in export subsidies for live cattle and carcass beef sold outside the EU, posing a threat to stock prices.
The 25% reduction is the fourth significant cut since early September and has been strongly attacked by farm and trade organisations. Meat and Livestock Commission economist Sally Doyle says it comes at a bad time, when the market is already in turmoil due to the BSE and offal arguments. The recent green £ devaluations will only marginally offset the cuts in subsidy.
Commission officials say the cuts are needed, as traders have already used up 60% of their 1.1m tonne export licences allowable under GATT in the year to June 30.
But EU farm group COPA says that, though it sees the need to respect GATT commitments, the gap between internal and world prices is so large exports to key markets in Russia, North Africa and Turkey will have to stop.
Although this loss will have a more direct impact on countries like Ireland, which sends a high proportion of its meat to Third Countries, it could also lead to more beef looking for a home in the UK, affecting prices over here. *