Sector News

Dairy UK details “hopes and fears” over Brexit

October 26, 2017
Food & Drink

Dairy UK has published a White Paper report which details the “game changing” opportunities and challenges which the industry is facing over issues such as Brexit and consumer confidence in dairy foods.

Some of the concerns center around the future of trading agreements with EU countries, specifically whether new tariffs will be introduced, and how UK dairy farmers could lose out to European competitors if a solid deal is not put in place.

Describing Brexit as the “most defining issue the industry has faced for generations,” the White Paper 2017 identifies what Brexit needs to deliver to safeguard the future interests of an industry that employs more than 70,000 people and has an overall turnover of nearly £28 billion (US$37 billion).

On prospects for the industry, the White Paper reveals that an increasing demand for dairy globally is putting world milk production on an upward trend.

On the issue of Brexit, Dairy UK says:
• Continued trading agreements with the EU without tariff and non-tariff barriers will mean massive export and growth opportunities – failure will damage exports and reduce demand for dairy;
• The worst outcome from Brexit would be a return to World Trade Organization (WHO) rules;
• An unhurried transition period would give the industry the chance to adapt and take advantage of the opportunities Brexit creates;
• Access to skilled and unskilled labor is vital – failure to maintain access will drive up operating costs, with a major impact on margins;
• UK dairy farmers should not be disadvantaged compared with their European neighbors;
• The Northern Ireland border issue should be resolved by creating a frictionless and seamless border regime that could be a blueprint for future arrangements with the EU.

On industry prospects, the White Paper reveals how demand for dairy is growing around the world and milk prices are on an upward trend. Dairy UK is also urging Government to work collaboratively with the industry to help exploit export opportunities around the world.

The White Paper also looks at consumer confidence and says that UK consumers continue to support dairy loyally, despite the arrival of plant-based alternative drinks and anti-dairy activism.

It says that 87 percent of consumers are drinking cow’s milk, 94 percent of adults are buying cheese and 78 percent enjoy yogurt or fromage frais. The latest figures show continuous growth in volume and value of sales of milk, cream, cheese yogurt, butter and organic dairy products.

According to Dairy UK, the government should also ensure that nutrient-rich dairy products remain exempt from the forthcoming sugar drinks industry levy when it is implemented next year.

“The White Paper demonstrates that consumer love for dairy remains very strong, and we have to ensure that we are equipped and ready to continue to help feed the nation for generations to come,” Paul Vernon, Chairman of Dairy UK.

“Brexit is a monumental challenge and a game changer. If Brexit is successfully delivered there is tremendous potential in terms of exports and product development. If it is a failure, there will be far-reaching consequences for dairy.”

“No effort can be spared by the industry, the UK government and the EU to secure a positive outcome and we will continue to give every assistance to the government to make that happen.”

“Given the increase in global demand for dairy, prospects are good. We do, however, need to seize the moment – and that will require yet more of the innovation and inspiration that have been the hallmark of our industry for generations.”

Dr. Judith Bryans, Chief Executive of Dairy UK, adds how the White Paper details the performance of the industry across a wide range of areas including nutrition, consumer trends, farming and milk processing, animal health and welfare and the environment.

“It shows we have a track record we can be proud of but, like any major industry, we have to maintain our deep commitment to continually improve and innovate. Ultimately, we are judged by consumers and we are very grateful for the outstanding and enduring support they give to dairy.”

Source: Food Ingredients First

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