Brexit: A no-deal dairy summary
Considerable volumes of dairy products are both imported and exported to the EU. Use the information on this page to understand the impact a no-deal Brexit scenario could have on the UK dairy industry.
Under a no deal situation, proposed UK tariffs mean there will be significant differences in the tariffs for imports to the UK, and for exports into the EU. These differences will bring a number of challenges for the industry.
- Tariffs have been proposed for imports of butter and some cheeses (including Cheddar), albeit at significantly lower levels than those that will be imposed by the EU.
- There are no proposed import tariffs on milk, cream, yogurt, whey products or fresh mozzarella.
- UK dairy exporters will face tariffs on the majority of dairy products exported to the EU. This will make UK products more expensive, and in most cases, uncompetitive on EU markets.
- It is likely that mozzarella, cream and yogurt will continue to come into the UK, given the lack of tariff. However, exports of these products will become disrupted, putting strain on UK exporters.
- Cheddar imports may be reduced due to the low tariff rate, while exports are likely to be severely disrupted. This could lead to a build-up of Cheddar stocks in the UK, and cash flow implications for Cheddar manufacturers.
- There is a tariff on raw milk imports into the EU, making the movement of milk from Northern Ireland to the Republic of Ireland uneconomical. This milk will either need to be processed in Northern Ireland, most likely into lower-value products such as butter and milk powder, or shipped across to mainland Britain for processing. The latter would put pressure on logistics and already strained processing capacity in Britain.
What would a no-deal Brexit mean for dairy markets?
Listen to our podcast in which Chris Gooderham, our Head of Livestock Market Specialists, joins Alistair McLaren to discuss the potential impact of a no-deal Brexit scenario on the dairy markets.