MAKING A SUCCESS OF BREXIT
As 72% of agricultural exports are to the EU  , agricultural businesses want UK-EU trade to take place on a preferential basis free of tariffs. The EU's importance to the sector as an export destination is likely to remain high, as perishable goods - such as milk and fresh produce - do not travel long distances well, despite innovations. The UK's agricultural businesses could therefore be put at a real long-term competitive disadvantage if their products become subject to tariffs in their largest market - with an average tariff on dairy products of 36%, animal products 20%, fruit and vegetables 10%  . Different types of farming will be affected by exit in different ways depending on the UK's future trading relationship with the EU because of this range of tariffs differing between industries  .
The agricultural industries in the UK and the Republic of Ireland are also tightly integrated. Large amounts of the Republic of Ireland's agricultural products are sold in the UK, and there is a highly interdependent supply chain on the island of Ireland. For example, a quarter of the North's milk pool is processed in factories located in the South  .
The agricultural sector widely holds the opinion that leaving the EU provides an opportunity for a completely new domestic approach to farming in the UK. The quality, grading, weight, sizing, packaging, wrapping, storage, transport, presentation, origin and labelling of agricultural products is currently regulated by the EU, and businesses in the sector also have a keen interest in environmental rules too. However, there is a challenge to balance this new approach with one that will still ensure favourable access for UK agricultural goods to the EU market.
Any new immigration system in the UK must take into account that 65% of the 34,000+ non UK-born workers employed in agriculture are EU migrants  . These workers do both full- time jobs in year-round industries like dairy and farming, and are employed for seasonal work, for example in horticulture  .
There is a real opportunity for the UK's agricultural sector to expand its exports across the world with a revived trade agenda. However, the UK government will have to take care to balance access to UK markets with the needs of domestic producers.
While agricultural business owners would generally rather not rely on subsidies to be viable, the way the global market works has rendered this necessary. Outside the EU, a new funding deal for agriculture must be agreed. An average of 55% of the total income from farming currently comes from CAP support payments  .
If the UK leaves the EU without a deal, international law will oblige the EU to implement tariffs on the UK's agricultural products. UK goods would also be subject to EU quota rules, with effective upper limits on volumes. Many companies are likely to find these prohibitive to trade. This would be a very difficult situation for Northern Ireland in particular. There would be considerable regulatory confusion and complication. This situation must be avoided, through interim arrangements if necessary.
For agriculture at the CBI, contact: John Stevens on 0207 395 8218 or John.Stevens@cbi.org.uk
 CBI, November 2016 Distributive Trades Survey
 CBI, November 2016 Industrial Trends Survey
 FDF, UK food and drink export statistics for 2015
 WTO, EU MFN Tariff Rates
 Wagenigenur, Implications of a UK exit from the EU for British agriculture
 NIFDA, Brexit: Challenges and Opportunities for Northern Ireland Food & Drink
 ONS data provided to the NFU
 NFU, Farming's Offer to Britain
 National Statistics, Total income from farming in the UK