Post-Brexit Red Tape Is Set To Cost The Meat Industry £120m A Year and Reduce Some Exports By Half
New barriers to the UK's trade with the European Union are set to cost British meat businesses an extra £120m a year and result in some traders losing 50% of their exports to the continent, a leading industry body has warned.
The British Meat Processors Association (BMPA) published a report on Wednesday detailing the disruption faced by meat exporters since new UK-EU trading rules came into effect on 1 January.
Businesses sending goods like beef and pork to customers on the continent now must complete stringent customs and health paperwork. They did not have to do this when the UK was in the EU's Single Market and Customs Union, as the former was fully aligned with the bloc's trading rules.
The BMPA estimates that this new red tape is set to cost the industry up to £120m a year.
Most companies expect a permanent 20% loss to their export trade, while others are expecting their international sales to be reduced by over 50%, according to the report.
"The British meat industry has felt the impact of Brexit more than most," it says.
"This is because our export system was never designed to cope with the next day, just-in-time food supply chain that we built up over the last 30 years with our nearest neighbour".
Up until the New Year, UK meat businesses would send goods to EU buyers within 24 hours using "just-in-time" supply chains. However, in some cases the new red tape has added three days to the process, the report said, reducing shelf life and leading European customers to cancel orders.
Meat exports to the EU were 50% of pre-January 1 levels in the first six weeks of this year, the BMPA estimates.
Another leading industry body, the Food & Drink Federation (FDF), earlier this week published new data pointing to a collapse in meat exports to the EU in January.
Beef and pork exports fell by 91.5% and 86.9% respectively compared to January 2020, according to the "extremely worrying" figures. The FDF said that while both pre-Brexit stockpiling and the coronavirus were contributing factors, the new paperwork was chiefly to blame.
The BMPA report warns that some of the new barriers facing meat traders are "simply not fixable".
"These include the costs for customs declarations, customs agents, freight forwarders and additional veterinary inspections, and are rendering certain exports un-viable," it says.
"However, the headline figure doesn’t take into consideration the extra ‘hidden’ costs from higher freight insurance, extra administrative staff and higher haulage charges to compensate for longer delays".
The report warns the government that it will not be able to replace lost EU trade with sales to elsewhere in the world because it is not compatible with the "nature" of meat supply chains.
"The nature of the fast-moving, high-value chilled fresh food trade we have with Europe cannot be replicated with countries that are not on our doorstep," it says.Nick Allen, CEO of the BMPA, said: “The export hurdles we face are now in plain sight and are not going away. We need Government to urgently re-engage with both the industry and the EU to work out detailed and lasting solutions".
The report echoes calls from other industry groups for the government to urgently negotiate a close veterinary agreement with the EU, like Switzerland's relationship with the bloc. Switzerland is not an EU member but is closely-aligned with its Sanitary & Phytosanitary rules in order to minimise friction at their border.
Replacing physical paperwork with electronic documentation would also "go a long way to easing the time delays, mistakes and confusion" for meat exporters, the report adds.
A government spokesperson told PoliticsHome: "A unique combination of factors, including Covid lockdowns across Europe, and businesses adjusting to our new trading relationship, made it inevitable that exports to the EU would be lower at the start of this year than last.
“We’ve always been clear that there would be new processes for traders, and we continue to support them in their transition to these new arrangements — as well as to seize the opportunities of trade around the world. We are pleased to see the majority of businesses adapting well to the new requirements".