The British Retail Consortium (BRC) is warning UK consumers could pay nearly a third more for everyday food items in the event of the country not striking a Brexit trade deal with the EU.
The BRC’s said its analysis had revealed more than 75% of the food the UK imports comes from the EU and, without a Brexit trade deal, most of these goods will be subject to new tariffs. As a result, it suggests, the average cost of food imported by retailers from the EU would increase by 22%.
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But with certain food items, such as cheese, that figure increases to 30%, according to the BRC’s research.
Its findings are based on the proportion of European food retailers sell and the potential impact of new tariffs, such as World Trade Organization tariffs. The impact will be considerable if UK producers react to higher import prices and push their prices up to align with foreign products, it argues
Andrew Opie, director of food policy at the BRC, said: “Even at the lower end of the risk, price rises of 5-9% dwarf the increase from inflation that shoppers are currently paying on food goods. And the tariffs are particularly high on meat and dairy products, meaning products such as beef and cheese would be hardest hit.
“With consumers’ buying habits being dictated ever more by a shrinking pool of discretionary spend, there’s no doubt that they will find an additional hit of this magnitude to their weekly food bills extremely hard to swallow.”
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By GlobalDataOpie admits there would be potential opportunities from new trade deals post-Brexit in the medium to long term but said there is “a pressing need to avoid a cliff-edge situation on Brexit day”.
He added: “This is why the priority for the UK government has to be securing the continuity of free trade with Europe from March 2019 and thereby delivering a fair Brexit for consumers.”
