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UK food exporters hit by extra costs post-Brexit

By JONATHAN POWELL in London | China Daily Global | Updated: 2024-02-23 09:22
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A customer carries a basket filled with food inside a Sainsbury's supermarket in Richmond, West London, Britain Feb 21, 2024. [Photo/Agencies]

Food businesses in the United Kingdom that send products to the European Union have had to pay out an extra 170 million pounds ($215 million) in export costs since the nation left the bloc's single market, according to analysis.

UK exporters of animal-origin foods are facing what has been described as the "catastrophic" consequences of having to pay for veterinarians to check consignments and sign-off health certificates before shipping their products, reported The Guardian newspaper.

Brexit, the name for the UK's withdrawal from the EU, formally happened in January 2020, and the UK left the European single market in December 2020.

Data from the Sanitary and Phytosanitary, or SPS, certification working group, comprised of trade bodies including the Fresh Produce Consortium, Dairy UK, and the Road Haulage Association, shows that in the last year alone, exporters have paid more than 58 million pounds in extra costs.

The SPS said this increase has led to a significant decline in the volume of exports, especially among smaller producers, with meat product exports to the EU dropping by 17 percent since 2019.

The SPS analysis shows UK exporters have requested more than 852,000 veterinarian certificates in the last three years, including for fish and fish products, livestock, and meat and dairy products, with each costing the exporter about 200 pounds to complete.

The cumulative total during this period surpasses 170 million pounds in extra expenses for exporters, an amount described by Peter Hardwick, the trade policy adviser at the British Meat Processors Association, as "catastrophic" for some smaller companies.

Hardwick said that small businesses faced the greatest impact because the new rules made it challenging to send mixed consignments to the EU, leading to increased costs due to multiple certificates. The SPS group estimates that food exporters, usually operating on slim margins, would have needed an additional 8.5 billion pounds in revenue to off set these added expenses during the three-year period.

Karin Goodburn, director general of the Chilled Food Association, said when factoring in new IT systems, administration costs, and additional workers, the true figure of costs for businesses would be significantly higher than just that of the certificates.

Quoted by The Guardian, Goodburn said: "We've had companies employ extra staff to do the new bureaucracy, one of my members had to employ 30 new staff just to shift the paperwork."

Recent data from the Office for National Statistics revealed there was a 17 percent decline in meat product exports from the UK to the EU in 2023, compared to 2019.

Hardwick said larger companies have had to absorb the impact of this reduction in export volume, leading to reduced profits and potentially higher prices for consumers, and he noted that some smaller businesses have decided it is simply no longer worth their while exporting to the EU.

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