Daily Management Review

Brexit will hit the UK fruit and vegetable industry


06/27/2017


Last summer, UK residents voted to "stop feeding the EU", meaning to finance a number of joint projects. Now, however, it turns out that it is the EU that feeds the UK: the British are forced to deny themselves fruit because of rising prices.



Pam Brophy
Pam Brophy
Оne year ago, on June, 23, inhabitants of the Great Britain voted to leave the European union. Although the immediate negotiations on the process of withdrawal began only recently, the economic consequences are already evident. According to the latest Euromonitor International study, the exit from the EU will undermine reliability of supplies of fresh fruits and vegetables to the UK and increase the price of healthy food, Business Insider reports.

"Withdrawing from the European Union without a trade deal will further weaken the pound sterling, leading to a further rise in prices for imported goods, mainly on fresh food. With such dependence on foreign agriculture in the current state, the UK is not ready to feed its people on its own", explains Sarah Petersson, a nutrition analyst for Euromonitor International.

Trade barriers and tariffs can exacerbate price increases if Great Britain leaves the single market without achieving special conditions for negotiations.

After that, the cost of strawberries, for example, can jump by 50%, notes international research company Datamonitor.

"UK leaving the single European market is expected to result in a change in tariffs for food trade between the UK and the EU. The rise in tariffs will lead to high fruit prices and, ultimately, could affect the consumption pattern of the British, since the UK will have virtually no chance to compensate for dependence on European imports during the forecast period 2016-2021", Petersson says.

Now the average Briton consumes 99 kg of fruit per year, but Euromonitor predicts that the consumption will decrease by 2.1 kg by 2020.

Volume of local production of berries (raspberries, strawberries, blackberries and blueberries) reaches more than £ 1.2 billion. The 131% market growth for the last 20 years was mainly obliged to the local production of strawberries.

In 1996, the British consumed 67 thousand tons of strawberries a year, and by 2015 this figure increased by 150%, to 168 thousand tons, the Guardian notes.

In addition, the domestic agricultural sector is heavily dependent on seasonal migrant workers who are threatened by plans by British Prime Minister Theresa May to abandon the free movement of people to the EU.

British farmers have recently said that the price of strawberries grown in the country may increase by more than a third, if seasonal migrants refuse to come to the country after Brexit.

Producers appealed to the government with a request to introduce a scheme of permits for seasonal workers to ensure development of production of fruit and berry crops in the UK.

According to a report prepared by the British Summer Fruits trade council, if the British manufacturers are forced to transfer production to the EU countries to provide access to the labor force, the price of strawberries will grow from about £ 2 per 400 g to £ 2.75, by 37%. Similarly, replacing local raspberries with imported berries will increase the price of a standard 200-gram package by 50%, from £ 2 to £ 3.

Currently, 9 out of 10 seasonal pickers and packers of British fruits and berries come from the European Union, primarily from Poland, Bulgaria and Romania. It is expected that the demand for seasonal personnel will increase by about 31 thousand people by 2020, if the industry continues to grow at the same rate.

In the UK, fruits traditionally account for a significant part of the seasonal workforce from Europe, because the harvesting is difficult to mechanize: machines damage the thin skin of fruits.

British Summer Fruits say that the industry is already suffering from a shortage of labor, as the fall in the value of the pound has reduced wages for EU citizens, while some of them feel less welcome guests in the country, or even afraid of being attacked.

Fruit producers say that the shortage of labor is now at the worst level since 2004, when people from the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia were finally granted the right to work in the UK.

source: businessinsider.com, theguardian.com






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