Welsh farmers are expecting their costs to rise by up to 8 per cent following the trade deal with the EU.
The UK and EU are close to agreeing a post-Brexit Free Trade Agreement, and the Farmers’ Union of Wales has said that it will result in non-tariff barriers.
Nevertheless, the FUW has said that Welsh farmers are breathing a huge sigh of relief because the consequences of a ‘no deal’ Brexit would have been “catastrophic”.
FUW President Glyn Roberts said: “The consequences of a no deal for farming and other industries would be catastrophic, so it was always hoped that common sense would prevail.
“However, there was always a risk that refusals to compromise on one or other side could lead to the worst case scenario.
“Our access to the EU market, which is the destination for three quarters of Welsh food and drink exports, will still face significant barriers after 31st December, with non-tariff barrier costs expected to rise by 4 to 8 percent.
“Nevertheless, the Welsh farming industry, like others the length and breadth of Great Britain, will be celebrating Christmas having breathed a huge sigh of relief that a deal seems close to being agreed.”
Mr Roberts also welcomed the EU’s formal listing of the UK as a ‘Third Country’ – a move which is essential in terms of allowing Welsh food exports to the EU.
Prime Minister Boris Johnson and European Commission President Ursula von der Leyen still need to rubber-stamp the final version before Christmas.
A meeting of EU ambassadors has been pencilled in for Christmas Eve to start the ratification process.
Talks had stumbled over the issues of what access EU boats will have to British fishing waters, and what rights the EU will have to impose retaliatory tariffs should the UK limit that access in the future. It has been reported that the UK Government made a number of concessions.
If an agreement is struck, the EU Commission will publish the draft unofficial text and send it to member states and the European Parliament.
The Welsh Government have raised numerous concerns about the preparations for Brexit if the transition period ends on 31 December, including whether facilities will be ready at Welsh ports in Holyhead and Fishguard.
The Farmers’ Union of Wales has previously slammed the UK government for what it calls a “Brexit betrayal” after it was announced that the Welsh agriculture budget was being slashed by Chancellor Rishi Sunak’s decision in the spending review.
The Conservative Member of the Senedd, Janet Finch-Saunders called for those claiming there were cuts to “withdraw their inaccurate claims immediately” but the FUW refused to back down.
Nick Fenwick, Head of Policy at the FUW said: “Based on the official figures published by the 2013 coalition government and the EU, the average annual funding made available to Wales through the EU CAP for the 2014-2020 period was around £330 million. The allocation announced yesterday is £240 million, which is around £90 million lower.
“The explanation for the difference appears to be that unspent EU money from the 2014-2020 CAP budget (which can be carried over into next year and beyond) is being used to make up the difference in order to validate claims that the total budget is the same – but that ‘carried over’ funding comes from the 2014-2020 budgetary period so shouldn’t be counted.
“Our concerns are shared by the Welsh Government, the Scottish Government and the Northern Ireland Executive, as well as many others, and we have yet to receive a satisfactory explanation as to why a £90 million gap exists after unspent 2014-2020 funds are discounted.
“Until we receive satisfactory assurances that the Treasury will make the same amount available as the EU did through the CAP, we will maintain that the promise to match EU funding has not been met.”