German farming lobby leader concerned at lack of Brexit plan

BERLIN (Reuters) - The head of Germany’s farming association voiced concerns about the lack of plans to deal with the impact on European Union finances and on massive volumes of food trade following Britain’s vote to leave the EU.

As Britain is a huge net contributor to EU finances, Brexit could have a major impact on funding of the EU’s farming support scheme, called the common agricultural policy (CAP), Joachim Rukwied, the president of the German farming association DBV, said.

“The discussion about the implications of Brexit on the CAP has not yet taken place,” Rukwied told Reuters.

Farmers should not face cuts to their EU support payments because of Brexit, he said.

A major challenge will be creating a satisfactory trading relationship with Britain after Brexit, he said.

British Prime Minister Theresa May, who has said she will begin the formal EU divorce process by the end of March, has come under fire from businesses, investors and lawmakers for having given little away about her plans for Brexit.

She is due to give a speech next week setting out more on the government’s objectives.

May’s farming minister has sought to reassure the British agricultural sector, saying it is the government’s intention to maintain as low tariffs as possible, and zero tariffs where it can.

German Chancellor Angela Merkel will on Wednesday chair a meeting of a cabinet committee on Brexit at which ministers will discuss organisational and structural issues related to Brexit.

German farmers are worried about the status of big German food exports to Britain which totalled about 4.8 billion euros (4.19 billion pounds) in 2015 or about 6 percent of German food exports. Sales include German meat, milk, grains, fruit and vegetables.

Britain exported 1.4 billion euros of farm produce to Germany in 2015.

“We have a surplus in trade with food from Germany to the United Kingdom of 3.4 billion euros,” he said. “I cannot see that any progress has been made on this issue in the United Kingdom.”

Britain could be involved in a food free trade deal with the EU after Brexit, German Agriculture Minister Christian Schmidt told Reuters in July.

Meanwhile, German farmers continue to suffer from the impact of a Russian ban on food imports imposed after Western sanctions were imposed on Russia following the Ukraine crisis, he said.

The loss of sales to Russia of German milk, pork, fruit and vegetables had caused downward price pressure, he said.

But increasing German exports of milk products and pork to China had made up for some of the lost Russian business and kept prices away from their lowest levels, he said.

Reporting by Hans-Edzard Busemann, Writing by Michael Hogan; Editing by Alison Williams