FDF warns of major impact on food supplies over Brexit uncertainty
The chief executive of the Food and Drink Federation (FDF), has warned of ‘serious disruption to food supplies’ including confectionery and bakery-based products, over the UK’s potential ‘no-deal’ Brexit from the EU.
Ian Wright spoke on the issue in the wake of the British government’s publication of technical notices of how areas of the economy are likely to be affected in the event no agreement is reached. He believed the ongoing uncertainty surrounding Britain’s future trading relations with EU nations presented a major obstacle for businesses across the industry.
As Confectionery Production has previously reported at the FDF’s annual conference, the organisation has advised that the sector should be fully considered as a valuable asset to the economy in regard to negotiations with the EU, highlighting food security as one of the critical issues surrounding trade between the UK and the continent.
Ian Wright CBE, FDF chief executive, said: “Today’s Technical Notices lay bare the grisly prospect of a ‘no-deal’ Brexit. We face chaos at the ports, serious disruption to food supplies, increasing business costs, rising consumer prices and ever more administrative burdens on the food and drink industry.
“The Technical Notices show that a ‘no-deal’ Brexit will have a severe impact on UK food and drink supplies and trade from March 2019. Upon leaving the EU, UK exports would face the EU’s prohibitively high WTO Most Favoured Nation tariffs, which would make many products uncompetitive and threaten the success of more than £13bn of our industry’s annual exports. If the UK were to waive checks on food and ingredient imports into the UK, as suggested, we would face legal challenges via the WTO while considerably undermining our reputation with the WTO’s 163 other members.
“UK food and drink manufacturers will need to make immediate and costly changes to product labelling to remove references to the EU in origin labelling. Additionally, a product labelled with a UK Food Business Operator’s name and address would no longer be able to be sold in EU markets, however this would be mandatory for products sold in the UK. The limited timeframe for such changes and the accompanying administrative burdens further threaten the success of UK export sales to the EU, our largest export market. If EU consumers are unable to access UK food and drink, the chances are they will switch to other sources of supply and those export markets will be lost forever.”
He added that consignments of food items, which include a wide range of bakery and confectionery goods heading to the continent will require physical and documentation inspections as they enter the EU. He highlighted the present lack of present inspection facilities at Calais, which he believed would create further major trading issues.
Significantly, he added that UK shoppers accustomed to year-round availability of a host of food items, face the prospect of reduced availability of goods in the event of no agreement being struck over Brexit. Mr Wright said that companies were already attempting to respond with a number of measures including stockpiling, buying-ahead, hedging currency risk, procuring additional warehousing, as well as relocating production to the EU, and other practical measures to secure supply.
He added: “The consequences of a ‘no-deal’ Brexit for UK food and drink are starting to be felt already. The impacts will snowball as we get closer to March 2019. Instead of lecturing the EU, the Government must secure a withdrawal agreement imminently or begin the arrangements to extend the Article 50 deadline so that they can do so in an orderly fashion.”