Brexit to take its toll on every sector, from food safety to packaging
Brexit has been delayed until the end of October, but the uncertainties regarding the exiting way for the UK is still raising questions about the future of the food industry in Great Britain. From food safety to packaging every sector will be impacted by a no-deal Brexit, as experts have already warned. Losses are also expected under a positive scenario but to a lesser extent.
High dependence
A no-deal Brexit is to hit not only food producers in the UK but also the packaging industry in the country, particularly plastics, which are included in Top 10 British imports and exports.
According to the British Plastics Federation, 69% of all British trade in plastics is completed within the EU. It estimates that failure to secure a trade deal with the EU would see a dramatic £540 million ($694 million) increase to the cost of imports and a £340 million ($437 million) increase to the cost of exports.
„The chain of supply for the F&B sector is most likely to be affected in case of no-deal Brexit, along with the supply for the packaging sector. This is across the board and could affect all imported plastics and polymers, cartons and paperboard, metal packaging and more. Products for FMCG, particularly food markets including chilled and fresh products are most at risk", explained Neil Farmer, UK packaging expert.
The ongoing uncertainty around Brexit has already determined some companies to delay their plans for expansion in the British market and, besides that, skills and labour availability in the UK packaging industry are questioned as 15% of the workforce in the sector is non-nationals.
In some cases, companies have increased their stocks of consumable items to prepare for a disruption in the market. The solution may be maintained as the scenario of UK’s departure from the EU is still unclear.
has built a reserve of consumable items to serve its clients in the British market in case o trade disruption generated by Brexit. "Due to the level of uncertainty, we've put plans in place to help ensure our customers continue to receive the best possible service and support. Sealpac UK has increased stockholding in the UK of the most commonly used consumable items by over 45%.
However, with the greatest will in the world and all due care and consideration, we will not be able to stock every part that is required by all customers. As you will appreciate, none of us knows for sure what the implications will be for our businesses, however, it would be remiss of us not to take suitable actions in order to mitigate the possible effects”, explained the company in a press release.
The company hopes to compensate for every possible loss in the British market through gains that may appear elsewhere. „With over 50% of their food products being imported, Brexit is bound to have a huge impact on the British food industry. Furthermore, the EU food industry sales will probably be impacted by stronger competition from non-EU countries that supply their products on the British market. The impact for us at SEALPAC is expected to be manageable. As we serve many countries, there is always somewhat of a balance; where one produces less, we normally see someone else produce more”, declared Martijn Scheffers, Sealpac’s International Sales Manager, in an interview for EuroMeatNews.
Delayed time
Since 2018, the food self-sufficiency rate of UK has been set at 64% and that raises the question of food supplies and delivery time in the British market.
The UK has one of the strictest regulation in the world regarding the shelf life of VP/MAP foods, including fresh meat. A certain delay in the supply chain will lead to a higher rate of food waste and increases the need for innovation in packaging.
Meat trade between the UK and the EU will be disrupted, regardless of the deal signed between the two parts, due to mandatory veterinary checks believes Margaret Boanas, chairman of the International Meat Trade Association.
Since 1997, all the food products of animal origin that enters the EU single market must face three mandatory checks: documentary, identity and physical checks. "It's a long line of checks, rather than just at the border when it enters the EU", explained Margaret Boanas.
That means that any meat exported by British producers into the EU must pass these steps, with a 20% ratio of physical checks for beef, lamb and pork and a 50% for chicken.
"Once is gone through all the official progress we shouldn't forget is that the customer, the wholesaler, the retailer, the manufacturer, will carry out further checks to make sure that it complies with their very specific requirements.
Besides that, the routes of transportation are possible to change as some European ports do not have a Border Inspection Point (BIP) to clear the meat that enters the EU. It's the case for Calais or the crossing points on the Ireland-Northern Irish border.
To plan and construct a new BIP takes several years and involves many steps including identifying an appropriate location within a port/ on a border, securing funding, obtaining planning permission, construction and sourcing veterinarians with the appropriate qualifications.
„It is logical to conclude that, in the event of a ‘no-deal’ Brexit, there might be a need for shelf-life enhancement and extensions due to delayed delivery times”, believes Neil Farmer. Under this scenario, short shelf-life food such as fresh, chilled produce, chilled dairy products, juice/juice drinks and many other perishables, including fresh chilled fish and seafood, meat and poultry, will be the worst affected.
Food security at risk
Not only that a lot of food arriving in the UK will have a shorter shelf life but the food security system in Great Britain is under scrutiny at this time. According to a recent report from High Speed Training. more than one in every 15 food businesses across England, Wales and Northern Ireland have a hygiene rating of two or lower.
The Food Hygiene Rating Scheme requires environmental health officers from the local government agencies to visit businesses between every six months and two years, depending on the level of risk involved. Hygienic food handling, the physical condition of the site, and food safety management are combined to make a food hygiene rating from zero to five. Zero means “urgent improvement” is necessary. Five means “very good.”
While one in every 15 businesses across England, Wales and Northern Ireland have an overall rating of two or lower, suggesting they required improvement, only one in every 30 sites involved concerns on physical handling of food.
In Wales and Northern Ireland, it is compulsory for businesses to display their food hygiene rating, but that rule does not apply in England. Wales and Northern Ireland both have an overall higher food hygiene rating than England, according to the report.
Scotland’s system is called the Food Hygiene Information Scheme (FHIS). There, after an environmental health officer has reviewed safety systems in place, observed food hygiene in practice and spoken with staff, businesses are given either a rating of “pass” or “improvement required.” Displaying the ratings on site isn’t required by law, but they can be viewed online.
“There are different areas of inspection and the schemes do have their limitations. It’s just about understanding that and knowing where to get the right information. Our report aims to improve consumers’ understanding of the Food Hygiene Rating Scheme and the Scottish Food Hygiene Information Scheme so they can make informed decisions around where to eat and drink”, said Lee Batchelor, coordinator of this project.
Automation and innovation
At the same time, the lack of workforce may force the industry to adapt by increasing the automation process in meat plants to cover for the eventual leave of the EU workers in this sector.
Innovation is also needed to improve the performance in the packaging and processing sector, considering the fact that the UK is still trapped in a carousel trade with partners in the Netherlands, Irish Republic and Denmark due to the limited processing and packaging capabilities. So imports of technology and investments in R&D sector are expected to happen in this market in the following years.
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