Subscribe
The finalization of negotiations relating to the EU-Mercosur partnership agreement in December 2024 between the President of the European Commission, Ursula von der Leyen, and her counterparts from the four Mercosur countries (Brazil, Argentina, Paraguay, and Uruguay) has generated significant and overwhelmingly critical commentary within Ireland. This reaction, while notable, was entirely predictable from the Irish perspective. Consistent and vehement opposition to the deal has been a defining mark of the policy positions adopted toward it by all the major Irish farming representative organizations, as well as Ireland’s political opposition parties and groupings, since formal negotiations on the essential objectives of the deal concluded in 2019.
One of the most prominent of these organizations, the Irish Farming Association (IFA), has gone so far as to state that if Mercosur is ratified, Irish and EU beef and poultry sectors will be decimated as a result of increased imports of tariff-free beef and poultry from countries that benefit from a competitive advantage due to their lower production regulations and standards. The IFA also asserts that Mercosur’s tariff-free quota of 99,000 tonnes of beef equates to 4 million head of cattle (calculated at 325kg carcass weight), representing 18% of current EU beef production. This large-scale influx, they argue, will disproportionately affect Irish farmers. Additionally, there are concerns that Brazilian imports to Ireland are likely to consist mainly of high-value beef cuts, such as steaks, further deepening the adverse economic impact for Irish producers.
From the European Commission’s perspective, these concerns are seen as both understandable and exaggerated. The Commission has made it clear that under the agreement, while the EU will allow 99,000 tonnes of beef to enter its market with a 7.5% duty, this volume represents only 1.2% of total European beef consumption, which stands at approximately 8 million tonnes annually. Furthermore, the Commission emphasizes that this quota will be phased in gradually over five years, providing European beef producers with sufficient time to adjust to the new market reality.
From the perspective of the EU Commission, opposition toward the deal is viewed as at best understandable but misplaced and at worst a symptom of counterproductive economic protectionism that must be overcome if the EU as a whole is to secure its export markets with global partners. The Commission argues that the EU-Mercosur agreement is a critical component of its broader strategy to enhance economic partnerships and ensure access to emerging markets. It is seen as a necessary trade-off in the face of rising trade nationalism, the economic impacts of COVID-19, the war in Ukraine, and the accompanying disruptions to global supply chains.
This view is largely shared by the outgoing Irish Government, whose ministers have pointed to these global changes in parliamentary replies. They argue that the EU-Mercosur Agreement, if ratified, will support Ireland’s strategic objective of diversifying its import and export markets in an increasingly unstable global trade environment. This soft acceptance of the essential value of the agreement has placed the Irish Government in direct conflict with Irish farming organizations, which have strongly criticized it for failing to stand up for what they see as the economic interests of one of the country’s pillar trade sectors.
Irish farming representatives have demanded that the Irish Government adopt positions similar to those espoused by France, Poland, and most recently, Lithuania, all of whom have signalled their clear opposition to Mercosur. France’s opposition, in particular, has been perplexing to some observers. As Aslak Berg, a research fellow with the Centre for European Reform, has noted, the Mercosur agreement is likely to create significant opportunities for the French dairy sector, making France’s stance appear contradictory.
The IFA and others have also demanded that the EU Commission address their specific concerns. These include the provisions set out in the EU Strategic Dialogue document on Mercosur, which outlines the inclusion of impact assessments for agricultural producers, the environment, health, labour, animal welfare, the supply chain business, and consumers in both the EU and partner countries. For the EU Commission, however, the Mercosur agreement represents what it has termed a “balanced outcome” that creates new opportunities for European farmers and food producers while mitigating possible market pressures.
According to the Commission, European farmers and food businesses stand to gain unprecedented access to the countries of Mercosur, which represent a large market of 260 million people. They argue that this will not be achieved by maintaining tariffs, as the IFA suggests, but rather by removing high tariffs for major EU export products, preventing imitation of EU traditional foodstuffs, and making food safety procedures clearer, more predictable, and less cumbersome for EU exporters. This position was reiterated by President Ursula von der Leyen at the finalization of negotiations in December 2024 when she described the agreement as a “win-win” deal, claiming it will bring meaningful benefits to consumers and businesses, saving EU companies €4 billion annually in export duties.
In an effort to further address the concerns of Irish and EU farmers, the Commission has also offered assurances that in the event of adverse economic impacts, farmers will receive support to make necessary adjustments. This includes a financial support package of up to €1 billion in the event of market disturbances. Additionally, the Commission states that this support will reinforce assistance available through the Common Agricultural Policy, providing an essential safety net for farmers and income support if needed. Despite these reassurances, however, the alarm within Irish agriculture remains high. Many stakeholders argue that no financial package can offset the long-term structural damage they foresee for the beef sector, a vital part of Ireland’s agricultural economy.
The scale of these concerns is perhaps best understood when viewed in the context of broader farm income challenges. According to the Irish research agency Teagasc, farm incomes in the cattle-rearing sector, which is predominantly focused on suckler beef production, have been under considerable strain. In 2023, while the value of output increased by 6% due to higher cattle prices, production costs rose by 11% on average. As a result, the average income for cattle-rearing farms stood at just over €7,400 in 2023, a decrease of 15% compared to 2022. For many farmers, these figures highlight the precarious nature of their livelihoods and amplify fears about the additional pressures the Mercosur agreement could bring.
Adding to the complexity, the Irish beef industry’s importance to the national economy cannot be overstated. In 2023 alone, the total value of Irish beef exports reached €2.7 billion, underscoring its role as a cornerstone of Ireland’s trade profile. This makes the perceived risks associated with Mercosur all the more acute. Critics argue that even with phased implementation and financial support measures, the agreement’s long-term impact will effectively decimate a sector already grappling with low incomes and high production costs.
As the agreement’s ratification process begins in 2025, it is expected that Ireland will witness significant and highly organized opposition from within the farming sector and among political groupings. The scale and intensity of this opposition will present a major challenge for the incoming Irish Government. How it manages this opposition will not only influence its popularity among Ireland’s rural base but also shape its relationship with the EU Commission. Should the Government ultimately decide to oppose the deal, it will need to carefully navigate the domestic backlash while considering the broader implications for Ireland’s position within the EU.
One thing is certain: the EU-Mercosur partnership agreement has reignited fundamental debates about the balance between trade liberalization and the protection of domestic industries. In Ireland, this debate is not just about economic policy but also about the broader cultural and social significance of agriculture as a way of life. As such, the outcome of the ratification process will have far-reaching implications, not only for Ireland’s agricultural sector but also for its role in shaping EU trade policy in the years to come.