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    Brexit: a conundrum of magnitude. Will it happen? Won’t it happen and if it happens, will it go through with or without a deal? With uncertainty looming most ominously, we can only speculate just what the impacts will be.

    It is suggested that the UK is only 60% self-sufficient when it comes to food, according to government figures, and 70% of its food imports come from the EU – but then we have become a nation addicted to avocadoes and year-round iceberg lettuce, will we starve as a nation? Most certainly not but availability and choice will be restricted. The departure with or without an agreement will have upheaval on what we see on our shelves after the day that Brexit does arrive.

    Are we going to face situations where food is in short supply? Predictions suggest that within days of the UK’s European Union departure, shortages could occur. But what we do know is that necessity is the mother of all invention and we will still be eating – what are consuming though, might be different and might cost more for a while. However, as a nation it is likely we will not starve.

    Many experts however across the British food industry, a great number of whom are producers, farmers and retailers which the British public depend on, are genuinely very nervous. No one doubts that there will be potential disruption to the food supply chain which could result in unharvested produce and empty shelves in the supermarkets. However, the supply chains from Europe have products to sell, and they simply can’t shift it anywhere else. Conversely the British consumer wants to buy them.

    So where will this lead us? The truth is no one has a clue!

    Towards the end of January, CEO of the UK trade body, Food and Drink Federation, Ian Wright said that a no deal Brexit would be “potentially catastrophic” and the Prime Minister was not giving adequate attention to the concerns held by the food industry. Such apprehensions have been heightened since the deal on the table was thrown out of parliament in January. Speaking with Business Insider earlier in February, Wright said:

    “We keep telling them [the government] that it [a no-deal Brexit] is potentially catastrophic but it is difficult to know just how much they’re listening.”

    In an effort to mitigate a disastrous fallout, various food manufacturers have started to stockpile ingredients and finished products out of fear of supply shortages. CEO Siobhan Talbot of Irish dairy and sports nutrition company, Glanbia, spoke with The Irish Times and told the newspaper:

    “We have stocks in the UK, more than we would normally have. We are very much planning for a no-deal at this stage, we have all the supply chain alternatives, all those pieces that one would expect but that does not mean that that would be easy and that does not mean that that wouldn’t be without its implications.”

    Of course, Brexit isn’t just going to impact on food production; anything linked to the industry will be at the mercy of the subsequent halo effect. Most of the food safety laws in the UK stem from legislation passed by the EU. This includes the legal necessity for food businesses to use food safety management systems which are based on the codes of HACCP for food safety management. Questions have arisen as to whether or not such legislation will be retained. It is unlikely to change as the approach is a global one and importantly, The World Health Organisation (WHO) established international food standards which act as a legislative base for countries throughout the world. To throw out the rule book would be pure madness then. It is likely that existing food safety legislation will simply be ‘cut and pasted’ and then restamped with a Union Jack instead of a European flag.

    The legislative framework is not nonsense, however, and they provide a solid foundation for food safety to operate. It is believed therefore that if and when Brexit does happen, a review of the legislation will inevitably transpire, but it is unlikely that much in term of amendments would need to follow. If the requirements are unnecessarily cumbersome, then change may happen, and this could be for the better.

    Labelling and packaging of goods which are intended for export from the UK into the EU will need to adhere to and comply with EU law. As such making these changes for the sake of it, would not be prudent and could be harmful.  The biggest predicted changes are to food safety however; the number of enforcements visits may be decreased to ease the legislative weight.

    Future labour availability is probably going to be one of the biggest impacts on British Food and Fresh Produce from leaving the EU. We have as a nation had a ‘cheap labour tap’ which has been flowing since 2004. Immigration, one of the bugbears of many who voted out, has fed the British economy with abundant, motivated and very often well trained and educated labour which has worked in the food factories and packhouses as well as in the fields picking fresh produce. This tap has effectively been turned off and this will have consequences for the industry. Stories of produce rotting in the fields are rare and are probably more down to flushes causing gluts, or over planting than pure labour availability. However the indigenous British population has historically been reluctant to pick fresh produce from the fields, so will this change?

    Most certainly not, so how will it get picked? The answer is going to be in the short term enhanced labour rates to attract people to undertake these tasks and in the longer term, automation.  But, despite the press releases from the universities working on these projects, realistically these are 3-5 years away. The cost of production and subsequently the prices of fresh fruit and vegetables will increase. Therefore it will be interesting to see whether the retailers will absorb these costs or pass them on.

    Is it coincidental that we have seen wage growth creep above inflation for the first time in over a year and we are seeing levels of unemployment fall to the lowest since the mid-1970’s? As the labour tap has turned off, are we seeing the forces of restricted labour supply and continued demand force up wages? Let’s see.

    Supply Chain & ProcurementLogistically, getting food into and out of the UK once Brexit has occurred is likely to change. Some have made a guesstimate that if an additional two minutes are required to check trucks and lorries, this could generate a 17-mile tail-back within a single day. The Dutch fruit and vegetable exporters are working on a lorry passport scheme which is designed to reduce these potential problems by creating a fast track for their goods. They want to sell it and the consumers will want to buy it – will market forces inevitably not come in to play?

    Some businesses who we speak to have taken on a more stoic standpoint and are getting on with it, rather than waiting to see what happens. Some of the shrewder operators have been getting into the swing of things with new product development and focussing on creating new or alternative items which can be sourced locally and do not come directly from the continent.

    From an environmental perspective, the reduction in food miles could be a welcome result from the exit process. Several of the more innovative businesses have investigated specifically how food mileage can be shrunk or negated and developed new initiatives that specifically tackle this issue. One good example is growing food aquaponically (a fusion of aquaculture and hydroponics). If this approach is applied to growing salad items, it is considered that food miles can be cut down to almost zero. This could remove problems such as those faced in Spain in early 2017 due to unseasonably cold weather that had the knock-on effect of a salad shortage in the UK. Shrinking the number of miles food must travel or negating the carbon footprint associated with growing and transporting produce, at least, will have a positive effect on the environment.

    New technology is not always the answer though, but adaptations to ones already in existence or indeed considering the opportunities of looking at readily available alternatives. With regards to market supply, it would be necessary to review supply bases to ensure that the best value is on offer. Understanding where the potential kinks in the chain are (regardless of a crisis, if that is indeed what Brexit is), is necessary to prevent a weakness causing a snowball effect. The result of carrying out such reviews, therefore, should reveal what unnecessary efforts can be removed with the result being, improved efficacy of the supply chain.

    On the whole, the outlook of what the impacts of Brexit will be on the food industry are in the short term more negative than positive. But – we simply don’t know what will happen – if anything will change at all! The uncertainty is definitely affecting business confidence as we have clients who have delayed investment projects until April and have held back on some senior appointments until there is more clarity.

    But until B-Day arrives, and that specified date is still up in the air, no one can say with absolute confidence just want the future holds. Until then, is it business as usual? To keep the nation fed, it will have to be.

    NO DEAL BREXIT – a big risk worth taking, or a potential catastrophe?

    Organic chief blasts EU proposals.

    EBF vice president Peter Rolker says proposed changes to EU law would have “severe consequences”

    New proposals for EU organic legislation have been slammed by a senior figure in the European organics industry as “a backward step” that would have “severe consequences” for the sector.

    The European Commission has been consulting on changes to regulation 834/2007, which covers the production and labelling of organic produce, and favours putting more emphasis on consumer issues and less on the environment and sustainability.

    However Peter Rolker, a vice president of the European bio/organic fruit forum EBF, told delegates at Prognosfruit this week that the proposals would “create a lot of uncertainty because of their complexity”, “endanger peaceful co-existence [among farmers] in fruit-growing regions”, would not solve the problems of criminal fraud in organics and would be “a backward step”.

    Rolker urged the EC to take more time to consult with stakeholders before bringing in any changes, and poured cold water on the suggestion that the revision could come as soon as late 2015 or early 2016.

    A critical point up for discussion, he said, is the issue of separate maximum residue levels (MRLs) for farms in intensive growing regions, where organic growers may be tainted by pesticide drift from conventional farms. Some commentators have called for an insurance fund to protect organic growers if they fail MRL tests as a result of drift.

    Other issues include proposed changes to the inspection regime to put more of the focus on the finished product and national exceptions to production conditions.

    Rolker wants to see residue-free become “almost market standard” and traceability back to farm modernised and better supervised by the EU authorities.

    Production increases

    His comments come at a time when the European organic top-fruit industry is on the up. A new production record for organic apples was set in 2014, when 25 per cent more fruit was grown in the EU than in the previous year.

    Rolker’s fellow EBF vice president, Gerhard Eberhofer, told Prognosfruit delegates that now is the time for the trade to look for new markets beyond the traditional destinations of the EU and North America, which could include Israel and the UAE.

    He added that the message to consumers should be all about freshness and taste at point of sale rather than the more ambiguous element of being ‘genuine’, and called for the creation of new umbrella branding to cover organic produce.

    Organic chief blasts EU proposals

    Growers claim the modifications effectively give Morocco free access to the European market

    Spain has criticised a European Commission to reform the Entry Price System for tomatoes claiming it will cause significant harm to Spanish producers by clearing the way for a massive influx of Moroccan tomatoes during the peak of the Spanish season.

    The Commission announced on Monday that it would modify the way it calculates entry prices to include cherry tomatoes, instead of just round tomatoes. The proposed change will raise the average entry price and effectively means that Morocco will be allowed to export to the EU tariff-free as the entry price at which point the tariff is activated will always be higher than the preferential price of €46.1 per 100kg.

    Murcian exporter association Proexport accused the commission of caving in to pressure from Morocco and other non-EU countries and effectively given them free access to the European market.

    “This decision is a disaster for Spain’s tomato producers and leaves us defenceless,” said José Hernández, president of Proexport and Fepex’s Tomato Committee. “This will bring about a new pricing crisis and provoke growers to abandon farms leading to significant job losses.”

    The Spanish government has been calling for the Commission to apply the rules set out under article 4 of the Association Agreement between Morocco and the EU, which requires that exports from the African country are maintained at a stable level to avoid oversupply. It also called for the entry price to be raised in order to offset the effects of the changes to the method of calculating the entry price.

    EU imports of Moroccan tomatoes have increased from 194,000 tonnes in 2004 to 369,000 tonnes last year.

    Spain slams EU tomato rule change

    Welsh grower Perkin Evans wants the NFU to keep lobbying Brussels to ensure food producers’ tool-boxes aren’t ‘depleted’

    Farmers fear Europe is fast becoming an over-regulated environment to operate within, NFU Wales has found.

    A new campaign by the union, called ‘Healthy Harvest’, has just been launched in response to concerns that already flat-lining UK crop production will go into further decline if Welsh farmers continue to lose access to key plant protection products.

    Statistics show that since 2001, half the plant protection products on the market have been lost, and over the next five years, half of what is left could also disappear from the market owing to overzealous regulation, not backed up by sound science.

    “Our toolbox as food producers is becoming increasingly depleted, at the very time we need to be stepping up to the challenge of producing more,” said Perkin Evans, chairman of NFU Wales’s Combinable Crops and Horticulture Working Group at the group’s recent meeting.

    He added: “Europe is fast becoming an over-regulated environment for farmers to operate within. We are steadily losing our markets to farmers elsewhere in the world, who have better access to more effective means of crop protection and production.

    “With global demand for food heading in only one direction, now is certainly not the time to be taking away the tools that we need to be able to produce disease free, high yielding crops, and we need the same access to safe technology as our competitors if we are to have a productive and competitive sector.

    “As more and more products get withdrawn, there is simply not the corresponding level of new products arriving on the market to replace them, and the reality is that European requirements to bring a new product to market have become prohibitively expensive and time consuming, leaving farmers and growers with fewer and fewer products to choose from. To make things worse, many manufacturers are decreasing investment in the European market, partly because it is over-regulated.”

    Evans believes that as a union, NFU Wales needs to keep lobbying to ensure that both EU and domestic regulators base the control of plant protection products on sound science; something that includes lobbying the EU to move away from its current hazard based approach, and return to a risk-based process.

    EU ‘over-regulated’ at a time when more produce is needed
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