This Welsh sheep farm
may look beautiful
but it's under threat.
Not just from the
impact of Brexit,
but now also from coronavirus.
Sheep farming is big
business in Wales,
which has a flock of 9.5m.
Sheep here outnumber
people three to one.
But coronavirus shut down
the service sector overnight.
A third of the lamb market gone.
So what can sheep tell
us about trade, Brexit,
and British farming?
Is there a risk that the
UK farming industry as we
know it won't survive
in its current form?
I think it's really, really
important that we take
these challenges one at a time.
You know, we absolutely must
deal with the coronavirus.
That's our first priority now.
That's got a massive impact
on all agricultural markets
at the present time.
Next, we need to make sure
that we get a deal with the EU.
So we need to work from that
and ensure that is right.
And then obviously, we
have the agricultural bill.
That will set the standards
and the way we trade.
Some farmers, like
Garry, we're worried
about leaving the European Union
long before the coronavirus
hit.
The domestic market is
split between the service
sector and retail.
But the remaining third of
all the UK lamb is exported.
And, until now, more than
90 per cent of exports
have gone to the EU.
So what's the issue?
Well, when it comes to trade
getting on with your neighbours
is very important.
Countries that trade
a lot with each other
can form a customs
union like the EU, which
doesn't impose
tariffs on members
but does impose
tariffs on non-members.
And when trade ties are tight
breaking up is hard to do.
Which is why Brexit
is hard to do.
The UK needs to
work out how to move
from being inside the
tariff-free EU customs
union to being
outside that union.
And it needs to negotiate which
tariffs are likely to apply.
It also needs to find
the time to negotiate
all this in the
middle of a pandemic
without face-to-face meetings.
EU tariffs on
agricultural products
are already higher than average.
That means UK sheep
are at particular risk.
We visited Garry's farm
in the Brecon Beacons
before the outbreak.
Garry, can you tell me which way
you voted in the Brexit vote?
Yes, I voted Remain, actually.
Important part of our
income is the support
for food production and
environmental management, which
was paid directly from the EU.
We need a trade deal.
And we need, we
need a trade deal
to be completed effectively.
It is absolutely vital
for farming within Wales
and, indeed, the UK.
So Garry, tell me,
this sheep right now,
how much would you get for
it if you sent it to the EU?
Oh, this lamb is
worth about £80.
£80?
£80 at present, yeah.
Unless the UK signs a
preferential trade deal
with the EU, its
exports could be
hit with the standard
tariffs the EU charges
all members of the World
Trade Organisation.
For lamb, that ranges from
40 per cent to 80 per cent.
40 per cent of £80 is £32,
which would bring the price
of the sheep up to £112.
Passing that extra cost onto
the consumer would hit demand.
But if farmers
were forced to pay
they could end up
operating at a loss.
I mean, would you actually
go out of business
if that happened?
Well, I mean, we'd be
in serious trouble.
Yeah, you know, we'd be
in very serious trouble.
We'd be... and, you know, you
may be able to cope with it
for six, nine, 12 months, but
not moving forward, you know,
not over any sort of
sustainable time period.
Before coronavirus the
National Farmers Union
warned that a
no-deal Brexit would
be catastrophic for
British farming.
UK politicians are
insisting they will not
extend the current
transition period
beyond the end of the year.
That means leaving without
a deal is still a real risk.
You can only take so
many hits at a time.
So let's take a sensible,
pragmatic view to this year.
Great - if we can get a
deal like it's been promised
and with no tariffs and a
good trading relationship,
that's absolutely great.
But let's be realistic on
what can be achieved here.
I don't know...
you know, there's been a
lot of really great things
to be learned from using the
internet for meeting purposes,
this, that, and the other.
But when it really comes down
to the nuts and bolts of it,
when we really getting
to those final stages,
I think you need to be
sat across the table
looking eye-to-eye and picking
up all of the body language,
and understanding all of
those messages coming across.
The lack of a trade
deal with the EU
could result in a serious blow
to the export of UK animal
products.
The UK government
could cut tariffs
to stop a rise in food prices,
actually increasing imports
from overseas.
And trade barriers between the
UK and the EU could make it
harder for farmers to get
medicines, fertilisers,
or immigrant labour.
Of course, it's not
just agriculture.
The EU is the UK's
largest trading partner.
In 2018, UK exports
to the EU were $291bn.
That's 45 per cent
of all UK exports.
UK imports from the
EU were $357bn, or 53
per cent of all UK imports.
If these exports
and imports get hit
with tariffs that could
be difficult for various
industries, not just farming.
If farmers don't get a good
deal in these trade negotiations
with the EU, how would it affect
the local communities here?
You know, we are the
backbone of the communities.
And, as the farmer, if the
farmer numbers decrease,
then, you know, where does
this leave the local schools,
the local businesses that are
reliant on the farming custom?
Are we just going to be a
retirement haven for, you know,
people have enough money
to move here and live here,
bearing in mind that a
lot of these farms are...
some of them are fourth,
fifth generation.
You know, their families
have been living here
for hundreds of years.
The Welsh language is based
around the farming communities.
Our culture...
it's not only
business, you know?
Through Brexit, Britain
voted to go it alone.
Some saw clouds overhead, others
saw a light shining through.
But few predicted a
global pandemic could also
be on the horizon.
Now farmers must struggle
with this new challenge.
The political and economic
landscape has changed.
New trade deals will change
the landscape once more.
