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Supply Chain

Food supply chains ‘in danger’ under Brexit

The British Retail Consortium (BRC) has warned about the potential for damaging consequences for UK consumers and EU producers if a Brexit agreement is not reached between the EU and UK from 29 March 2019.

The BRC sent a letter to UK prime minister Theresa May and the European Union’s chief Brexit negotiator Michel Barnier highlighling the dependent state of UK’s food supply chain upon trade with tens of thousands of EU-based producers. The trade body says 50% of Britain’s food is imported and 60% of those imports come from the EU-27.

The letter listed several possible consequences including food rotting at ports, reduced choice and quality for UK consumers, higher prices as the cost of importing goods from the EU increases, and £21 billion of exports to the UK at stake.

It also said a Brexit deal will mean “new border controls and multiple ‘non-tariff barriers’ through regulatory checks, creating delays, waste and failed deliveries” as BRC analysis found that food and beverage products would face a 29% average increase in the cost of importing from the EU from non-tariff barriers, under a no-deal scenario.

Other BRC figures showed that 3.6 million containers from the EU passed through UK ports in 2016, with 10,000 per day delivering 50,000 tonnes of food to UK consumers. BRC also warned more than 12,500 small retail businesses will be at high risk of going bust in the event of no deal.

Richard Pennycook, chairman of the BRC, said: “We must avoid a cliff edge scenario on the 29 March 2019 at all costs. Failure to achieve a smooth transition will create a lose-lose scenario for UK consumers and EU producers. Our food supply chain is complex, highly organised and ultimately fragile. Frictionless trade is essential if the industry is to continue to provide the level of choice and value in shops that UK consumers are used to seeing.

“It is now of the utmost importance that the UK government proposes a workable solution to the backstop that gets the Withdrawal Agreement over the line and allows for a smooth transition. We need the EU to be flexible and creative in negotiation and recognise what is at stake for exports to the UK. Time is running out.”

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