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ICOS calls for the EU and US authorities to work towards a de-escalation of the current trade tension and to find a mutually beneficial resolution, to avoid a costly and destructive trade war.

BRUSSELS & DUBLIN, Thursday 3rd October, 2019 – Following a decision by the World Trade Organisation to award the US the authority to claim $7.5 billion in annual compensation, in retaliation for EU subsidies paid to airplane manufacturer Airbus, the United States Trade Department yesterday announced that hundreds of EU exports would be hit by an additional tariff of 25%, including Irish dairy exports of butter and cheese.

These tariffs are expected to take effect following the next WTO meeting on the 14th October and will impose a significant cost on the dairy industry at a time when uncertainty and the threat of a no-deal Brexit continues to cast a dark shadow. This was highlighted by ICOS Dairy Committee Chair, Peter Fleming, in Brussels today at meetings with the European Commission, Irish MEP Seán Kelly, and within the European Farmers and Co-operative Organisation, Copa Cogeca.

“Ireland will be one the biggest losers from a dairy perspective, as the US is one of our top export markets. Irish dairy exports to the US were worth over €250 million in 2018. The vast majority of these exports were of butter and cheddar cheese, both of which will be subject to this additional higher tariffs. Irish butter is already subjected to a substantial tariff $1,541 per metric tonne, meaning these additional tariffs would cost something in the region of €10 million for Irish butter exports alone.”

“86% of all EU butter exports to the US are from Ireland and therefore the inclusion of butter on the list of products disproportionally impacts and disadvantages Irish dairy co-operatives and farmers, in this dispute that has nothing to do with agriculture.”

“It is disturbing that the agri-food sector could again bear the brunt of yet another geo-political fall-out. We are still grappling with the impact of the Russian import ban on the European dairy market and coming to terms with the threat of Brexit and its potential devastating impact on our largest export destination and we must now also contend with new barriers and costs to accessing one of our principle international markets.”

“It is vital that the European Commission, and the European Commissioner for Trade, both outgoing Cecilia Malmstrom and incoming Phil Hogan, concentrate their efforts on finding a diplomatic resolution to this situation to safeguard our trading relationship with the US and creating a stable international trading environment,” said Peter Fleming.