Russian food ban risks thousands of jobs

07-Aug-2014 - Last updated on 08-Aug-2014 at 11:03 GMT

Lost fish exports could devastate the Scottish fishing industry

Thousands of British food manufacturing jobs and millions of pounds worth of exports are threatened by Russia’s ban on food imports.

Scottish fishing industry Jobs and exports could be particularly hard hit, warned the Scottish Pelagic Fishermen’s Association (SPFA). Its chairman Alex Wiseman told FoodManufacture.co.uk: “We are very worried. Russia is the biggest importer of our nation’s fish – mainly mackerel. We are talking about £17M worth of seafood and fish.

“Also, several thousand jobs in fish processing plants could be affected.”

Manager of fish processing firm Luna, based in Peterhead, Sinclair Banks told BBC Radio 4’s Today programme that up to half the firm’s turnover of £60M involved fish exports to Russia and the Ukraine. Russia accounts for 16% of Luna’s mackerel exports.

Mackerel exports

Only small volumes of salmon are exported to Russia.

Russia imposed an immediate, one-year ban on food imports from the EU, US and some other western countries in retaliation for recent sanctions imposed due to the Ukraine crisis. Announcing the ban Russian prime minister Dmitry Medvedev said the ban covered: all cheese, fish, beef, pork, fruit, vegetables and dairy products. Scottish whisky exports are unaffected by the ban.

The National Farmers Union (NFU) said the impact of the ban was likely to felt most keenly in EU countries, but could reduce UK food prices. NFU deputy director general Martin Haworth said: “The UK exports very little to Russia. In 2013, for example, UK total food and drink exports, including alcohol, equated to just £115M; including £17M of frozen fish, £5.7M of cheese and £5.3M of coffee.”

But other EU countries do export a lot and the ban could have a knock-on effect in the UK. “This timing from president Putin is also worrying as it comes when most farm prices in the UK have already seen significant falls over the past year and any further downward pressure can only exacerbate problems,” said Haworth.

‘Unsustainable low prices’

“Looking back, when Russia banned imports of EU fruit and vegetables during the German E.coli outbreak in 2011, the impacts were felt throughout the supply chain – retailers were tempted by low-cost EU imports which led to pressure for UK growers to match unsustainable low prices.”

British retailers are also expected to be affected by the ban. Marks & Spencer has 41 stores in Russia and draws 4% of its operating profit from the country.

Russia is thought to account for 10% of all EU exports of food and drink – valued at €12bn (£9.6bn).

US food exports to Russia are valued at €972bn (£772M).

Earlier this week FoodManufacture.co.uk reported a former British government insider’s comments that Britain should thank president Vladimir Putin for focusing national attention on the security of energy supplies.

UK food and drink exports to Russia