Sector News

No-deal Brexit could raise price of mince by 50%, meat industry says

October 29, 2018
Consumer Packaged Goods

The price of mince would go up 50% in the event of no Brexit deal, the meat industry has warned.

It would push British favourites including burgers, spaghetti bolognese and shepherd’s pie out of the reach of many families and cause budgeting difficulties for nearly all meat-eaters, with data showing 55% of all beef consumed in the UK is mince.

“It would be a significant price rise and it’s a valued product to the consumer, not just used in spag bol but also lasagne and koftas,” said Katie Doherty, policy director of the International Meat Trade Association.

Speaking at a National Farmers’ Union conference in London she said no deal would mean huge food inflation, with World Trade Organisation tariffs highest on food products.

This is because Britain eats more than twice as much beef as it produces and is highly reliant on imports.

Beef imports would be on average 62% more expensive across all cuts, sheep meat up 57%, and pork and poultry up 32% and 31% respectively in a WTO scenario.

“These aren’t tariffs that you can just absorb into your business, we are a slim margin sector,” she said.

Doherty said the association has estimated it would have to double the number of cattle bred in Britain in order to keep all beef home-grown.

Politicians who see Brexit as an opportunity for British farming have argued that farmers simply need to “grow more”.

But Doherty said this was a flawed argument. “You can’t just turn on the tap and get more cattle, it would take years to get up to the levels that would be needed,” she said.

At the same conference Arla, the Scandinavian food producer, said products such as Lurpak butter could be 30% to 40% more expensive in a no-deal scenario.

Products it exports to the UK, including speciality cheeses such as Danish blues, would also be hit.

Peter Giørtz-Carlsen, head of Europe at Arla Foods, said under a no-deal scenario the consumer would be faced with a choice – stop eating a product altogether “or choose lower quality”.

The NFU has expressed deep concern that Britain’s stated intent to lower tariffs on imports to guard against food shortages would have a devastating effect on British farmers who will not be able to compete on price with EU suppliers.

Under the UK government’s strategy for a no-deal scenario, EU products would be cheaper than other non-EU imports and could put British food producers out of business, while British exports to the EU would attract a tariff and become more expensive to the European consumer.

“It is a unique lose-lose scenario. We lower our tariffs, the EU doesn’t lower theirs,” said Martin Haworth, director of strategy at the NFU.

Arla Foods, which works as a co-operative, sells the produce of one in four British farms.

“No deal would not be good for anyone, nobody is benefiting, the supply chain would be broken down the middle with tariffs and non-tariff barriers like extra documentation adding further costs,” said Giørtz-Carlsen.

“There is only one way to deal with that. It will go to the consumer because no business can absorb a 40% cost increase, so it will lead to food inflation, and also less choice,” he added.

Doherty told the conference that exports of the parts of carcasses that British consumers reject, such as bone and offal, are a key part of the farmer’s business model.

But they will be hit too. Under EU rules all non-EU products face 100% document checks, with poultry facing 50% physical checks and red meat 20% physical checks.

By Lisa O’Carroll

Source: The Guardian

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