Northern Ireland faces food shortages in ‘major crisis’

Northern Ireland’s hospitals and schools risk running out of food when post-Brexit Irish Sea trade arrangements are fully implemented, claims minister.

A grace period that limits the level of red tape required to move retail food products from Great Britain to Northern Ireland runs out at the end of March.

Here’s Perishable Movements Limited Sales Director Nick Finbow with some top tips for importers and exporters to Northern Ireland to ensure they are red-tape compliant once the exemption expires.

If your business needs more guidance get in touch with our team

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Once that exemption expires supermarkets will have to comply with more rigorous animal health certification processes under the terms of Brexit’s Northern Ireland Protocol.

With depleted supermarket shelves already in evidence in Northern Ireland with the lighter-touch trade controls, Agriculture Minister Edwin Poots warned of a “major crisis” once the grace period ends.

“It was made very clear to us by the suppliers to both hospitals and schools that if the current arrangement for supermarkets isn’t extended in a few months’ time that they will not be able to supply our hospitals and schools with food,” he told BBC Radio Ulster’s Nolan Show.

“That is a major crisis and I have raised this with (senior Cabinet minister) Michael Gove.

“Seriously, are we going to have a situation where our hospitals and schools are not able to feed the children at school, they’re not able to feed their patients?

“That is an outrageous situation that we in Northern Ireland have been put in as a result of the protocol negotiated between the UK Government and the European Union.”

Under the terms of the Northern Ireland Protocol, the region has remained in the single market for goods. That requires strict health checks on animal-based food products being shipped from Great Britain.

Some products are prohibited from entering Northern Ireland at all under single market rules.

Sausages and other chilled meats, which are on that banned list, have been granted a six-month grace period to enable their import from GB to continue until June using temporary Export Health Certificates.

Northern Ireland also applies EU customs rules at its ports, requiring customs declarations on goods moving from GB.

Baffling Brexit rules threaten export chaos, Gove is warned

Business groups tell ministers to sort out bureaucratic mess caused by EU trade deal.

Perishable Movements Limited senior management team remain ready and able to provide advice to government ministers as needed and to importers struggling to navigate the red tape of the post-Brexit trade deal.

Empty shelves at a Marks & Spencer’s store in Belfast. The retailer has warned that red tape will increase costs.
Empty shelves at a Marks & Spencer’s store in Belfast. The retailer has warned that red tape will increase costs.

Ministers must restart trade negotiations with Brussels immediately to sort out the “baffling” array of post-Brexit rules and regulations that now threaten much of the UK’s export trade to the EU, leading business groups have said.

Amid mounting anger among UK firms at cross-border friction they were told would not exist, British manufacturing and trade organisations met Cabinet Office minister Michael Gove in an emergency session on Thursday to discuss problems resulting from the deal struck by Boris Johnson with the EU before Christmas.

The prime minister had hailed what he claimed was a “zero-tariff” and “zero-quotas” deal that would allow free and simple access to the single market. Less than a month on, however, Britain’s EU departure appears to be anything but pain-free.Advertisement

One leading figure involved in the talks with Gove described the new rule book as a “complete shitshow”. Another said Gove seemed “very concerned” at hearing reports of problems, after a week in which Marks & Spencer was among leading companies to warn that more bureaucracy would increase costs. The source added: “He [Gove] seemed to realise the full gravity of the situation that is unfolding and about to get worse.”

Gove admitted on Friday that there would be “significant additional disruption” at UK borders as a result of Brexit customs changes in the coming weeks.

In the first week after the UK finally left both the single market and customs union, the parcels firm DPD suspended some of its services, bookseller Waterstones halted sales to customers in the EU and UK fishermen warned they would not be able to sell their fresh produce into EU markets because of delays at borders.

There were also problems with consignments between Great Britain and Northern Ireland as new border checks caught many businesses unawares. Luxury food store Fortnum & Mason also told customers on its website: “We are temporarily unable to deliver to Northern Ireland or countries in the European Union”, while Debenhams has temporarily shut its online business in Ireland.

Some of the problems are being blamed on a rushed deal, and others on the sheer complexity of arrangements including “rules of origin”, some of which have not been finally determined. Only goods made up largely of parts that originate in the UK qualify as tariff-free.

Stephen Kelly, chief executive of the Northern Ireland business organisation Manufacturing NI, said: “The reason why the UK and EU originally agreed that there would be an implementation period of 11 months was so that people could get their heads around what was needed and assure their businesses were compliant. But we didn’t have that. We had seven days before everyone had to be ready, and one of those was Christmas Day.

“There is a big problem with GB businesses being unaware of their new responsibilities. We have the triple whammy here of Covid, Christmas and new customs rules arriving all at once without any time to adjust.”

Johnson assured Northern Ireland business owners in November 2019 that they would have “unfettered access” to the rest of the UK. “There will be no forms, no checks, no barriers of any kind,” he said. If anyone told them they needed to fill in forms, “tell them to ring up the PM and I will direct them to throw that form in the bin.”

The government was also facing pressure over its Brexit deal from the SNP. Ian Blackford, the party’s leader in Westminster, called on the UK government to “pay compensation to Scotland”, claiming a “multibillion compensation package” was needed to mitigate the costs of Brexit in Scotland.

Stephen Phipson, chief executive of the manufacturers’ organisation Make UK, said much still needed to be negotiated between the UK and EU. “Industry welcomed the trade agreement that avoided the catastrophe of no-deal, as tariffs and quotas would have been a disaster for exporters. However, this is only a starting point, as there are still substantial issues that need ironing out, with many months, if not years, of tough negotiations ahead.

“There are customs experts with 30 years’ experience who are baffled by what the new regulations mean, let alone small- and medium-sized businesses who have never had to deal with the kind of paperwork that is now required. The great fear is that for many it will prove too much and they will simply choose not to export to the EU.”

He also raised fears about the UK car industry, which could be adversely affected by tariffs if EU rules relating to the origins of components used in car manufacture cannot be met. “Having built up seamless and complex supply chains over decades, the automotive sector in the UK is facing a jolt to its systems that places its very future under threat,” he added. “While there is no suggestion multinationals will close plants overnight, we have already seen decisions to build new models placed elsewhere. As those models that have been built in the UK for many years come to the end of their life, we are likely to see a slow puncture for the sector of investment drifting away.”

Dominic Goudie head of international trade at the Food and Drink Federation said talks needed to re-start between the UK Brussels.

“Where problems emerge there will need to be further conversations,” he said. “The trade deal provides the means to do that. It is a question of whether is the will to do so” (after so many months of talks.”

Sam Lowe, a senior research fellow at the Centre for European Reform, said there were problems that could grow over coming weeks and months.

“The new import/export formalities are proving problematic for many companies. The lack of obvious queues at the border disguises the fact that many trucks are stuck in depots, unable to head to the ports due to their clients failing to provide the necessary documentation and information.”

Source: The Guardian

Kent lorry chaos: Seafood rots by the roadside as gridlock predicted to last days

The gridlock in Kent will “take days to clear”, officials warned last night amid fears that fresh produce caught up in the delays will perish.

Fish was among the products causing the greatest concern to exporters, who warned it would have to be discarded. “The window wherein companies would be able to salvage anything from the last couple of days is now closed for premium seafood, which has been perishing by the roadside since Sunday night,” Donna Fordyce, chief executive of Seafood Scotland, said. “Millions of pounds have been lost, much of it by small companies that were depending on this trade for survival.”

Fears were also growing last night that supermarket shelves would be emptied in the coming days, despite an agreement by the French and British to resume freight movements from this morning.

“The real issue we face is what happens in the next day or so,” Andrew Opie, director of food and sustainability at the British Retail Consortium, told MPs on the business, energy and industrial strategy committee.

“If we do not see the empty trucks, which have already delivered to warehouses and stores, getting back over the Channel, they will not be able to pick up the next consignment of fresh fruit, vegetables, salad vegetables.

“What we’ve been told by members is that unless those trucks can start travelling again and go back to Spain and Portugal and other parts of Europe, we will have problems with fresh produce from December 27. What we need is for those trucks to move in the next 24 hours if we are to avoid seeing problems on our shelves.”

Nicola Sturgeon, the Scottish first minister, said that perishable produce such as seafood must be prioritised if hauliers are able to start moving again today. “We still await detail of the agreement, but if freight starts moving tomorrow, as we must hope it will, the plan to prioritise perishable produce such as seafood should be activated immediately,” she said.

Officials in Paris announced last night that an agreement on both sides of the Channel would allow for a limited resumption of travel, including “accompanied freight” from today. Only people with negative coronavirus test results will be permitted to travel.

A Turkish lorry driver has breakfast by the M20 yesterday

A Turkish lorry driver has breakfast by the M20 yesterday

A statement from the French prime minister’s office said lateral flow tests, which provide a result within 20 minutes, would be authorised providing they were able to detect the new strain of coronavirus.

Hundreds of soldiers will be deployed to a former airfield in Manston, Kent, to conduct the tests on up to 6,000 lorry drivers a day from this morning. Drivers who test positive will be told to isolate in hotels.

Businesses were hoping the gridlock in Kent would be cleared by Christmas, but many are already counting the cost of the 48-hour border shutdown. Nimisha Raja, founder of Nim’s Fruit Crisps, in Sittingbourne, said: “We were supposed to have eight tonnes of lemons coming in last week, that’s roughly 40,000 lemons.

“The delivery was organised well in advance of the Christmas shutdown, as we have an order going out mid-January, which requires at least two to three tonnes to fulfil.

An aerial view of Manston airport shows lines of lorries yesterday

An aerial view of Manston airport shows lines of lorries yesterdayWILLIAM EDWARDS/AFP/GETTY IMAGES

“Unfortunately, the order never got to us, initially because of a bank holiday in Spain and then the realisation that the double whammy of Covid-19 and Brexit would make it too time-consuming and too risky.”

DPI, based in Castle Donington in Leicestershire, manufactures and supplies illuminated displays for shops and the events industry. Sandra Wiggins, the company’s boss, said it ships six-metre-long crates of aluminium into the UK from the Netherlands from which it fashions lightboxes.

With its latest shipment delayed it will have to decide whether it should pay transit costs of £6,000 for a delivery of supplies that normally costs £1,800, and with no guarantee they will arrive.

Edward Naylor runs Naylor Industries, manufacturing pipes at facilities in Barnsley and Fife, employing 150 people. The pipes are used for carrying electricity cables into homes and telecommunications and power to motorway gantries and traffic lights.

It sources polyethylene from a company in Nantes in France and was told this week that because of the level of Covid-19 outbreaks in the UK its hauliers would not be leaving France. “Their message to us was we have got the stuff. We want to get it out to you. But we can’t. And we won’t be able to get it to you until things normalise,” Mr Naylor said.

Lorries are parked on the M20, with a contraflow system for cars

Lorries are parked on the M20, with a contraflow system for cars

However, his company had expected Brexit disruption and built up a larger than normal buffer of stocks through to February. “That is £1.5 million of stock sitting around on 20 to 30 trucks, tying up a not inconsiderable sum for a company our size,” he said. “We are in danger of becoming a plastic pipe manufacturer without any plastic. There is a sense of impending doom.”

Others are praying borders farther afield open soon to flights from the UK. “Our biggest problem has been air freight and the live lobsters being flown in from Canada,” Keith Smith of Caterfish, one of the biggest operators at the Birmingham Wholesale Market, said.

“When they heard our latest news [on the pandemic], Canada cancelled the flights. That is a big shame for the local Chinese community around here who like their live lobster.

Drivers feel like caged monkeys

Lorry drivers stuck at a disused airfield because of France’s freight ban complained that they felt like “caged monkeys” and “lab rabbits” (Charlie Parker writes).

Yesterday, as the sun set on Manston airport, Kent, the sound of hundreds of horns filled the air as drivers protested against the “blockade”. More than 1,500 heavy goods vehicles are trapped while the UK thrashes out plans to reopen the French border to trade.

Daniel Kroba, 36, from Poland, had dropped off luxury chocolates when the border shut on Sunday. He parked on a side street but police told him to drive to the airport, 30 minutes away. He was among 873 HGVs to arrive at the site before 6am. A further 650 vehicles were moved there from the M20.

The government was under pressure yesterday to turn the airport into a Covid testing site, but Mr Kroba said: “Why do we need a test? We are not lab rabbits. My family is waiting at home. Two little girls and my wife are sad.

“We’re just stuck in the middle of the fight between [the] UK and France, waiting. We don’t know if we can leave. We feel like rabbits and monkeys. It’s inhuman.”

Another Polish driver said: “The toilet here is broken and the next one is one kilometre walk away. It’s impossible to get home for Christmas.”

At 4pm hundreds of drivers held their hands down on their horns in protest.

The Department for Transport (DfT) told the press not to enter the airfield due to Tier 4 rules inside, although scores of drivers could be seen standing together with limited social distancing being observed.

There are 77 toilets and 66 urinals at Manston, the DfT said, and hot food was available. Several lorries left the airfield during the day. “The lorry drivers are free to leave the airport site at any time,” the DfT added.

Manston shut in 2014. It was an RAF base in the Battle of Britain and acted as a reception centre for Polish airmen.

Source: The Times

Aviation security for cargo from 1 January 2021

These are the UK Government’s official measures in place to ensure cargo can fly to and from the EU without disruption from 1 January 2021.

Perishable Movements Limited clients can rest assured that our pre-chartered freight flights will ensure that a No Deal Brexit does not disrupt our supply chain. It also provides options for prospective customers who are looking to set up alternative measures to cope with long tailbacks on cross-Channel freight services.

Cargo from the EU to the UK

The UK intends to recognise EU cargo security rules to minimise disruption to air cargo networks. Airlines flying from airports in the EU, Switzerland, Norway, Iceland and Liechtenstein will be able to fly cargo to the UK in the same way as they do now.

Cargo from the UK to the EU

The EU intends to recognise the UK cargo security regime allowing cargo to continue to fly into the EU.

Cargo will be able to fly from the UK to the EU, Switzerland, Norway, Iceland and Liechtenstein without a security designation, in the same way as it does now.

Cargo from the rest of the world into the UK

Airlines from the rest of the world must have a special security designation to fly cargo into the EU and the UK as part of the ACC3 programme.

UK only inbound cargo scheme will be set up to make sure security standards are not affected. This will mirror the EU scheme and grant security designations from 1 January 2021 to allow all cargo to continue to ship smoothly while maintaining existing security standards.

Regulations and standards

Existing aviation security regulations and procedures will be incorporated into UK law.

The EU intends to recognise the UK aviation security regime and include the UK in its One Stop Security system so that cargo screened in the UK will not have to undergo additional security checks on arrival in the EU.

Source: Gov.uk

What does 2021 have in store for chartered air freight services?

There is no sign of any slow-down in the world of e-commerce, in fact quite the opposite. With so many consumers forced to adapt their shopping habits in response to the restrictions imposed as a result of Covid-19, it is likely that the changes that have been made will be long lasting.

While the world remains optimistic that the traditional retailers will be able to resume normal trading, the fact is that consumers will have become accustomed to revising their approach to purchasing and will be loathed to turn their back on the speedy digital shopping experience.

Perishable Movements limited, Sales director Nick Finbow.

In response to this, more and more aircraft are being reconfigured to carry cargo, rather than passengers and there has been a spike in the number of aircraft retrofit businesses able to undertake these specialist works. Since the production of the Boeing 747 has stopped in favour of the more fuel efficient, newer 777, so interest in the procurement of 777s to lease or buy has increased and while some of these may already be converted for cargo, we are likely to see more of these passenger aircraft configured to accommodate the exclusive handling of cargo.

The world of e-commerce traditionally focuses on a high proportion of goods being transported out of China into major European hubs. As a result, there is likely to be a predicted growth in the number of chartered air freight services transferring consignments out of these hubs and delivering them to local European markets. This means that once again, the pressure for space will be intensified on these flights.

Given the world’s growing mandate to address the need to slow down climate change, it is also likely that the future will bring new break throughs in fuel efficient engines which represent an improved carbon emissions proposition. For companies who trade on their ‘green’ credentials, this will enable them to potentially reconsider the use of chartered aircraft, which will in turn create further demand for space.

Impact of Brexit

Brexit has effectively provided a massive boost to the chartered air freight industry. Companies which specialise in perishable goods cannot risk being caught up in cross-border delays, delays which can have a devastating impact on time-sensitive produce. UK supermarkets and independents demand quality fresh produce, with a good shelf life. Goods which have been kept in transit when they should have been on the shelves will have a reduced shelf life triggering substantial losses to the producer.

For Perishable Movements Limited, the speed of transit associated with chartered aircraft services, supported by the company’s ability to handle product with an unbroken cold chain thanks to its unique relationship with Heathrow’s only dedicated chilled airside facility, has dictated an even stronger interest in chartered air freight in the wake of Brexit. Such is the demand that Perishable Movements Limited, has seized the initiative to charter its own aircraft to ensure the seamless and timely transfer of fresh produce.

Coronavirus crisis

The impact of the global pandemic continues to be felt in all sectors of industry and the chartered air freight sector is certainly not exempt. As countries begin to prepare for massive vaccination programmes the priority for many airlines is to captialise on the opportunity to carry the vaccines and as a result the race for space on chartered flights continues to heat up.

Competition for space in turn brings with it spiraling prices. Not only are logistics companies having to contend with the traditional seasonal variation in prices due to the influx of electronic products to satisfy the Christmas market, now the charters are becoming even more expensive due to the potential to charge a premium price for the transportation of PPE and vaccines.

Looking ahead

As the biggest independent perishable goods importer, Perishable Movements Limited continues to work hard to stay ahead of the curve. In addition to chartering its own twice-weekly flight from Nairobi to Heathrow, the company is watching the market to identify new opportunities to increase the number of flight rotations operated by Perishable Movements Limited and its partner network.

Having an in-house air charter service division, headed up by someone who has acted on both sides of the fence, working for an airline as well as an independent charter broker means that the company is well placed to access the very best air trade lanes. But as anyone in the logistics business will testify, these will be challenging times for the industry

Source: Fresh Talk Daily

British Retail Consortium say BREXIT main impact will be on imported fresh produce

Supermarkets have urged people not to stockpile food and lavatory rolls in response to fears that a no-deal Brexit would interrupt supplies.

The British Retail Consortium (BRC) said shops had been working to prevent shortages being caused by disruptions to cross-border trade. However, it said there could be an impact on supplies of some fresh fruit and vegetables because the UK relies heavily on imports from the EU in winter.

Helen Dickinson, BRC chief executive, said: “Retailers are doing everything they can to prepare for all eventualities on January 1 — increasing the stock of tins, toilet rolls and other longer-life products so there will be sufficient supply.

“While no amount of preparation by retailers can entirely prevent disruption there is no need for the public to buy more food than usual as the main impact will be on imported fresh produce, such as fresh fruit and vegetables, which cannot be stored for long periods by either retailers or consumers.”

Other industries have spent years making plans to cope with a no-deal Brexit scenario. Perishable Movements Limited is one of the UK’s few fresh produce importers to have implemented their Brexit-ready plans to ensure their customers continue with little disruption to their supply chain. Measures include a purpose built temperature controlled facility in Spalding, complete with its own Border Control Post and regular chartered flights from East Africa to their facility at Heathrow.

Over the weekend, many media outlets reported on the number of people stockpiling goods ahead of a no-deal Brexit. The government is trying to allay fears by preparing measures to protect farming and other vulnerable sectors and to try to ensure deliveries of perishable goods and vital supplies are maintained.

But is this action too little too late?

UK government on farming:

The government is planning to help sheep farmers who would be among the worst hit by a no-deal Brexit.

The UK exports 30-40 per cent of its lamb and 90 per cent of that goes to the EU. Without a deal, an average tariff of 48 per cent would be imposed on sheep meat. This would kill the export market and result in an oversupply in the UK, driving down prices and potentially making many sheep farms unviable.


A Whitehall source said the Department for Environment Food and Rural Affairs (Defra) was “looking at specific interventions which will help to mitigate impacts for sheep farmers”.

The source pointed out that farmers in the EU would also face hardship if tariffs were imposed. The UK purchased more than 80 per cent of Denmark’s total exports of bacon and ham, worth £100 million, in 2018.

The National Sheep Association said the two support measures being discussed with Defra were a payment per breeding ewe or a top-up payment for each lamb sold.

The UK government on fish imports:


Trucks carrying fresh and live seafood will be given priority, enabling them to bypass queues in Kent. Lorries carrying day-old produce will get the same priority.

About 80 per cent of crab, lobster and other shellfish landed at UK ports is exported to the EU and is highly perishable.

Barrie Deas, chief executive of the National Federation of Fishermen’s Organisations, said the UK relied mainly on Iceland and Norway for cod and other white fish and these supplies were unlikely to be disrupted.

He said tariffs were only about 8 per cent on unprocessed fish so British exports were likely to maintain their market share because of their good reputation.

The UK government on travel:


A combination of coronavirus restrictions and Brexit means there is now the “real possibility” that Britons will be barred from travelling to the EU once the transition period ends, industry figures warn. The UK will become a “third nation” — with European borders closed to the majority of such countries at present.

Individual states can overrule the EU and permit access to foreigners. However, an estimated 2.5 million Britons face being unable to travel because their passports will be invalid. From January 1 documents will be required to have at least six months’ validity at the time of entry.

Tailbacks are likely on the M20 approach to the Eurotunnel in Folkestone. French authorities have been testing new software at their checkpoint in Kent, which has already caused delays.

Under EU regulations passengers whose flights are delayed or cancelled are owed compensation of up to €600. The Department for Transport confirmed the rules will become enshrined in UK law at the end of the transition period.

The UK government on medical supplies:


Drug companies have been increasing stockpiles to reduce the risk of shortages. While there would be no tariffs on medicines, deliveries could be delayed by extra border checks. The government is arranging new routes into the UK, including rapid air freight for urgent supplies.

Perishable Movements Limited remain on hand to support the UK government with temperature controlled transport and storage of critical medical supplies ioncluding the Coronavirus vaccine.

Explainer: The potential impact of Brexit without a trade deal

As another one of our charter flights from Kenya touches down at Heathrow and the fresh product makes its swift journey to our temperature controlled warehouse just a stone’s throw away, we consider how BREXIT will affect others within our industry who rely on access via the UK’s sea ports to get their products to market.

Many businesses are warning of goods shortages as chaos builds up at UK ports ahead of the Brexit deadline. We’re watching the delays at ports getting worse as demand surges with firms seeking to build stockpiles. Fortunately, for Perishable Movements Limited clients’ it’s smooth sailing by air.

Britain and the European Union are seeking a post-Brexit trade deal, with failure likely to result in increased chaos in mutual trade, financial markets tumbling and huge economic costs.

UK businesses have raised the alarm over shortages and rising prices thanks to a surge in containers flowing through UK ports as the economy begins to recover and companies try to build up supplies ahead of the Brexit deadline. 

Shipping costs have roughly quadrupled for some firms and delays at the UK’s largest port, Felixstowe, are causing vessels to miss out the stop altogether, unloading their goods at Rotterdam or other European ports instead.  

The delays threaten to add to expected chaos as the Brexit transition period ends on 31 December with UK and EU negotiators still locked in talks over a deal.

Congestion has been building for several weeks and “is definitely getting worse”, said John Newcomb, chief executive of the Builders’ Merchants’ Federation.

“It’s spread from Felixstowe to other major ports.”

Retailers raised the alarm last month that they were struggling to import goods partly because of congestion caused by a backlog of 11,000 containers of PPE ordered by the government.

Mr Newcomb and other building industry figures raised the issue of port delays with government ministers a month ago. 

“They were supportive but we haven’t seen any improvement, it’s gaining momentum,” he said.

He added: “The closer we get to Brexit day, any additional pressure put on the ports and affects the smooth flow of building materials, that’s a big concern for us – particularly if we don’t have a deal.”

Cheshire-based supplier Timco said 60 per cent of its shipped containers were being delayed by around two weeks after vessels chose not to stop at Felixstowe.

Timco director Simon Midwood said the firm has 160 containers waiting to be imported from Asian ports but there is currently no shipping space. Goods that have been shipped are between 3 and 17 per cent more expensive for customers due to a four-fold rise in shipping costs, Mr Midwood said.

Here

Travis Perkins, one of the UK’s largest builders’ merchants, urged customers not to worry but to plan ahead in case of supply issues.

“The pressure on certain product lines is a combination of factors, such as manufacturing taking time to catch up post lockdown and pent up demand from customers, which is now picking up pace,” a spokesperson said. 

“Congestion at UK container ports may be a compounding factor, but we have a strong supply chain that enables us to have a sophisticated sourcing strategy in place.”

If no deal is reached, the building trade faces tariffs of up to 10 per cent and further price increases if the pound falls against other currencies.

The UK produces about four fifths of building materials locally but products such as power tools are mostly imported. Other industries such as vehicle manufacturing are expected to be more severely impacted by port delays and rising costs. 

The flow of trade out of the UK is expected to experience severe delays. The government’s reasonable worst-case scenario is for queues of 7,000 lorries in Kent. HMRC forecasts that, even with a deal, UK firms face an additional £7.5bn in administrative costs

Here are some of the potential pressure points of a failure to reach agreement on trade.

STERLING

Investors and banks have long predicted a trade deal would be done, so a no-deal would hit the British pound, foreign exchange traders say.

But investor sentiment was hit by the sides saying on Saturday that there was still no agreement covering annual trade worth nearly $1 trillion, and sterling has fallen against the U.S. dollar since then.

The shock result of Britain’s referendum on leaving the EU in 2016 sent the pound down 8% against the dollar, its biggest one-day fall since the era of free-floating exchange rates began in the 1970s.

TRADE

In the case of a “no deal” on trade , Britain would lose zero-tariff and zero-quota access to the European single market of 450 million consumers overnight.

Britain would default to World Trade Organization (WTO) terms in its trade with the 27-state bloc. It would impose its new UK global tariff (UKGT) on EU imports while the EU would impose its common external tariff on UK imports.

Non-tariff barriers could hinder trade, with prices widely expected to rise for British consumers and businesses

Borders risk disruption, especially the main crossing points, with experts saying shortages of certain foods are possible in Britain as it imports 60% of its fresh food, with disruptions in British lamb exports to the EU also possible.

Any disruption would be felt most keenly by sectors that rely on just-in-time supply chains, including autos, food and beverages. Other sectors likely to be affected would include textiles, pharmaceuticals, and chemical and petroleum products.

The EU is Britain’s biggest trading partner, accounting for 47% of its trade in 2019. It had a trade deficit of 79 billion pounds ($104.86 billion) with the EU, a surplus of 18 billion in services outweighed by a deficit of 97 billion pounds in goods.

Even with a deal, Britain expects thousands of trucks bound for EU countries to stack up in the southern English county of Kent, with delays of up to two days.

THE ECONOMY

The long-term impact could be costly for both Britain and the 27 remaining EU member states.

A no-trade deal would wipe an extra 2% off British economic output in 2021 while driving up inflation, unemployment and public borrowing, Britain’s Office for Budget Responsibility (OBR) has forecast.

The OBR said tariffs under WTO rules and border disruptions would hit parts of the economy such as manufacturing that were emerging relatively unscathed from the COVID-19 pandemic.

According to economic research by insurer Allianz in November, a hard Brexit – a sharp, disorderly split – could cost the EU as much as 33 billion euros in annual exports, with Germany, the Netherlands and France hit the hardest.

The shock would be felt unevenly across continental Europe, with those likely to be hit worst including Ireland, the Netherlands, Denmark, France, Germany, Sweden, Portugal, Poland, the Czech Republic Cyprus, Malta and Hungary.

The Halle Institute for Economic Research has forecast that EU companies exporting to Britain could lose more than 700,000 jobs if no trade deal is agreed.

Hylke Vandenbussche, a professor at Belgium’s University of Leuven, said in a report last year that Belgium would be the worst affected EU member state relative to its size, especially its food sector, with the loss of 10,000 jobs.

UK unveils Border Operations Centre: but is it too little too late to avert a Brexit import crisis?

The UK government revealed this week that it has established a border operations centre to monitor the flow of goods and travellers in and out of the country. It’s hoped that the facility will alleviate some of the anticipated border disruption that could last months as the country leaves the single market and customs union.

Regardless of whether there is a post-Brexit trade deal, french authorities will impose full EU customs and controlled goods checks on all goods arriving from Britain from January 1. Current legislation states that all produce must be inspected at its first port of call into the UK.

Ministers fear the checks could lead to queues on this side of the Channel, with the possibility of up to 7,000 lorries waiting for two days in tailbacks. It will also affect the shelf life and route to market of a significant amount of the UK’s fresh produce increasing wastage amounts and CO2 emissions.

These concerns are shared by some of the UK’s key players in the logistics, shipping and import/export industry.

Mike Parr is director of global fresh produce cargo specialists, Perishable Movements Limited (PML). His team has been importing fresh produce from outside of the UK since 2003 and reiterates the concerns raised by ministers.

“We’re so close to Brexit; it’s imperative that the government start addressing key questions if we are to ensure that our borders can cope with leaving the European Union.” 

“Who will be running these facilities and where will they find and train the staff needed to deliver a service that meets the exacting standards of DEFRA inspectors and vets?”

Mike Parr’s comments reflect the wider industry atmospherics that query why the government has failed to call upon the expertise of commercial companies practiced in the day-to-day handling and processing of imported produce.

Earlier in November PML opened it’n new Border Control Post (BCP) in Spalding to streamline and fasttrack its process of importing fresh produce to the UK while future proofing against Brexit chaos for its customers.

“There are a number of purpose built handling facilities across the UK which the government should be using as inspection facilities to relieve the pressure on the UK’s ports. By failing to consult with industry experts, consumers and businesses that work with imported goods face a bleak start to 2021 which will affect national supply chains, transportation links and much more. This is not what the industry needs after a difficult year navigating Covid-19”, added Mike.

Labour’s shadow Cabinet Office minister Rachel Reeves said ministers were “once again” putting the “burden on businesses to prepare for the end of the transition period, when it has not explained what it is those businesses are getting ready for”.

She continued: “The government is rebadging a basic element of preparation but still can’t tell us how many customs agents are recruited or trained or whether crucial IT is ready.

“With glaring questions like these still unanswered, this government must do much more than just ‘demand action’ from UK businesses, already under huge pressure from the pandemic – and instead provide them with some much needed answers.”

PML announces innovative solution to border control delays

PML, the global perishable cargo specialist is partnering with transport and logistics company FreshLinc to operate an HMRC / DEFRA approved Border Control Post (BCP) and ERT (bonded warehouse) facility at Fresh Linc’s Spalding HQ, enabling a speedier movement of product from the ports and extending shelf life by up to 48 hours.

The BCP which has been in development for the last four months, will be effective from 1st January 2021 and represents a £400,000 investment. This includes the creation of a purpose-built 10,000 sq ft warehouse with the ability to store 330 pallets; dedicated inspection areas for customs and DEFRA and the training of four new dedicated staff to run the 24-hour operation.

The decision to set up a BCP away from the ports – Spalding is within easy reach of both Dover and Southampton docks – is in direct response to the ongoing delays and excessive queues which currently impede the onward movement of freight. The imperative to take action is amplified given the specialist and sensitive nature of PML’s cargo – the majority of consignments require temperature-controlled conditions – and the anticipated further disruptions likely to be caused post Brexit.

The long-standing and trusted working relationship between the two companies has enabled a seamless journey from the inception of the idea to create a dedicated BCP at FreshLinc’s 70,000 sq ft site, to completion of all the works required to meet the demanding criteria as defined by HMRC and DEFRA.

“This is a great opportunity for us to work with PML to maintain the continuation of the food supply chain especially against the backdrop of the uncertain times we are now facing as a result of the challenges posed by Brexit and the coronavirus. The BCP is a perfect example of two like-minded businesses coming together to provide an innovative solution to an industry problem.”

Lee Juniper, Operations Director at FreshLinc.

“This venture will enable us to move product much faster from the ports, cut down on wasted journeys and should ultimately deliver a minimum of 24-48 hours additional shelf life on all our customers’ products. Our priority is to guarantee the safe and timely transfer of goods, ensuring that there are no breaks in the cold chain. By creating a remote BCP, we are no longer constrained by the issues at the ports and PML is able to operate and manage its own facility.”

PML Sales Director, Nick Finbow.