Industry response to EU exit extension

By James Ridler contact

- Last updated on GMT

The EU Council's agreement to extend Brexit has had mixed responses from the food and drink industry
The EU Council's agreement to extend Brexit has had mixed responses from the food and drink industry
The EU Council’s decision to allow the UK to delay its departure from the EU has been met with relief and scepticism by the food and drink industry.

Food and Drink Federation (FDF) chief executive Ian wright said the removal of the immediate threat of a no-deal Brexit had come as a relief to the industry.

“The additional time must now be used wisely,” ​he added. “Government and Parliament simply must give us a coherent plan to lead us out of our current mess.

‘A way forward’

“It must be a way forward that allows us to make progress in resolving the future of our relationship with the EU, taking full account of the needs of food and drink businesses.”

The British Meat Producers Association (BMPA) echoed Wright’s sentiments, urging politicians not to waste the months leading to 31 October with further indecision.

A BMPA spokesman said: “Politicians must understand that every day of uncertainty that goes by is costing businesses, industry and the country money. Trade will continue to slow, investment decisions will be put on hold further and, as a consequence, the economy will suffer.

“We have already seen a huge amount of resource ploughed into no-deal Brexit planning – a cost that will impact on everyone. Government must strive quickly to resolve a situation that is still a crisis and will continue to be so whilst we have uncertainty and a lack of clarity.”

Uncertainty remains

The British Frozen Food Federation (BFFF) expressed disappointment that, despite this extension, uncertainty still remained and called for clarity on the UK’s future relationship with Europe.

“Our members need this certainty to help them plan ongoing business strategies and operations,” ​said BFFF chief executive Richard Harrow. “The short-term view being taken by politicians on this is utter madness.

“It is adding overheads to so many elements of running a business at a time when our members are already dealing with higher costs from business rates, the Apprenticeship Levy, pension costs, a declining labour pool and higher raw material costs. The sooner our members understand what the relationship with Europe is going to be, the better.”

Last chance

John Perry, managing director at supply chain and logistics consultancy Scala, said the extension would give UK businesses one last chance to make their voices heard. Whatever the outcome, the additional few months would give the industry the opportunity to prepare as thoroughly as possible.

“The decision many companies must now make is whether or not to continue to stockpile, which is an incredibly costly endeavour, negatively impacting cashflow and increasing expenses for storage and warehousing,”​ Perry continued.

“This extension could allow them, instead, to look beyond stockpiling and put in place more effective, long-term risk-reduction strategies. There is even enough time for affected organisations to consider applying to become an Authorised Economic Operator, which is widely agreed to be one of the most effective mitigating factors in any Brexit situation.”

Related topics: Supply Chain, Frozen

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