(Bloomberg) -- Rabobank International analysts sought to predict what could happen to British and European agriculture under a no-deal Brexit.
The bank listed various consequences in a report on Thursday. Some of the effects are well known, such as faster U.K. food inflation because of the weaker British pound and spoiled produce because of border delays. But others have been less publicized. Here are some possible scenarios:
Extra U.K. grain
Under European Union rules, biofuels must be blended into normal fuel. If this policy isn't continued in the U.K., it'll be less attractive to make ethanol. That could lead to additional grain supply and lower prices, which might benefit other industries such as the makers of livestock feed.
Sugar refining boost
“Part of the U.K. sugar industry may benefit from a hard Brexit” if EU limits on imports of raw sugar no longer apply, Rabobank said. With more imports, refiners could put spare capacity into operation. However, U.K. sugar beet producers would lose out because of stiff competition from cheaper imports of raw sugar.
Read more: How Sweet Is Brexit? U.K. Sugar Giants Split Over Outlook
Invalid seeds
Seeds, livestock and testing of plant varieties that are certified in the U.K. wouldn't be recognized in the EU. U.K. companies would have to get new authorizations from another EU country to continue to operate in the bloc, Rabobank said.
Irish question
If there is a hard border between Northern Ireland and the Republic of Ireland, it may become too expensive to take milk, live animals, barley and alcohol across the border. Rabobank said companies with facilities on both sides could be forced to separate their operations.
To contact the reporter on this story: Áine Quinn in Moscow at aquinn38@bloomberg.net
To contact the editors responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net, Nicholas Larkin
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