FDF: UK Food Manufacturers Face a Challenging Period after Brexit

UK food manufacturers face a "very challenging period" in the wake of the country's decision to leave the EU, trade body the Food and Drink Federation has said this morning.

Some 51.8% of UK voters backed a so-called Brexit in the vote. In early trading, sterling fell to a 30-year low against the US dollar.

Ian Wright, director general at the Food and Drink Federation, which represents food and soft drinks manufacturers operating in the country, said there would be frustration at the result among the bulk of the association's members.

"In March we released the results of a poll of our members which showed 70% support for Britain to remain in the EU. It's inevitable in the light of those results that the majority of FDF members will regard this as a disappointing result for the food and drink industry," Wright said, according to just-food.com

Wright added: "Now FDF will work on behalf of our members and all those across our industry to find a way through this very challenging period that we face. We'll focus on working with the Government to understand what this means for trading, market access and regulation to secure the best outcome for British food and drink manufacturing businesses and their consumers."

UK Prime Minister David Cameron announced this morning that he resigns.

A “momentous significance” for UK food

In a report – called Food, the UK and the EU: Brexit or Bremain? – Professor Tim Lang, from the City University London, and Victoria Schoen, of the FRC, have mentioned that both consumers and businesses will be affected by a vote to leave the EU. This is a deviation from what the authors describe as the real task of getting the UK food system, from production to consumption, to be more sustainable.

If the country decided to leave, food imports are predicted to become more expensive, prices would increase and there could be major disruptions to the finely tuned just-in-time supply chains on which the UK food system now depends.

With such prices increases for imported goods, it is suggested there could be consequences for the consumption of foods that the UK relies on EU nations to produce. For example, nearly 40% of the UK’s total food supply of fruit and vegetables comes from the EU, and nearly 55% of its supply of pig meat.

The authors express concern about the health implications of Brexit, as diet now accounts for 10.8% of the nation’s total disease burden (compared with 10.7% for tobacco).

According to the report, the UK is about 60% food self-sufficient so should be wary of instant independence from the EU.

The authors also warn of a potential “food service and food factory crisis” if EU labor currently working in those industries lost their freedom of movement to be in the UK – figures show EU employees make up more than a quarter of the food manufacturing workforce (26.9%) and a tenth of workers in food and beverage services (11.3%). This compares with 6.1% across the UK economy as a whole.

Professor Tim Lang, Director of the Centre for Food Policy at City University London, and Chair of the FRC, said: “It is not simply a choice about farming – the decision will affect the entire UK food system and all of our daily lives. Food prices will almost certainly go up, affected by a weakened sterling. The UK is in a vulnerable position already with a food trade gap of GBP21bn in the red – we import far more food than we export. This is particularly important for health, with a heavy reliance on EU fruit and vegetables now exposed.”

Dr Victoria Schoen, Research Fellow for the FRC, said: “We argue that, with the level of food that we import from the EU – particularly fruit and vegetables – it deserves a prominent place in the national debate about the implications of Brexit. The UK currently has only 164,000 hectares in horticulture, out of 4.7 million hectares available for crops.”