Friday, 19 March 2021
In this week’s blog, AHDB’s Market Intelligence Director Phil Bicknell shares his take on a discussion with leading exporters about the short term impacts and long term opportunities for UK agri-food.
Last week I hosted a webinar with some leading lights from the agri-food exports industry talking about the short term challenges and long term opportunities resulting from EU exit.
What struck me about the discussion was the air of optimism about the future of UK food exports, albeit tempered by a solid grip on the practicalities of making the opportunities afforded by our new trading position outside the European bloc a reality.
The other feeling was one of relief. While there have been a lot of negative headlines and chat about the new ways of trading with the EU, while acknowledging this has been problematic and costly for some, the situation we are in now is clearly better than the alternative of crashing out without a deal. Panellist Mike Gooding of Farmers Fresh, a farmer-owned lamb processor which sends 75 per cent of its stock to the EU, said he was grateful to still be in business, despite a litany of challenges to overcome. These range from dealing with an ‘archaic’ paper-based certification system, to paperwork and checks adding an extra day to delivery times (and taking a day of shelf-life), to the frustration of trying to keep up with continual changes to rules and regulations.
Nicola Thomas of the UK Food and Drink Exporters Association confirmed there had been some issues caused by Brexit for her members but there was a bigger question mark over how Covid has changed consumer attitudes towards food, especially in terms of health and food safety. She saw rising global grocery spend and growth in the middle classes as positives for the industry, with Made in Britain a recognised hallmark of quality and safety, though she urged would-be exporters to take stock and think carefully about which markets were the best fit for their products and how far they were willing to adapt.
Stephen Jones of dairy export trading company Somerdale said that dealing with the EU as a third country had been a big learning curve but it was something we had to learn to live with. He cited issues around rules of origin, where loads of UK cheeses going to customers in New Zealand would previously have been sent to the Continent and consolidated with other European cheeses before shipping. As for the rest of the world, the US lifting the retaliatory 25 per cent tariff on cheese among other products was a ‘good sign’ and he echoed the opportunities in China and South East Asia, while he warned businesses would face a ‘long hard slog’ in these markets.
For me, the overwhelming message to come out of our discussion was that we, as an industry, need to invest. We need to invest in technology to simplify the paperwork and red tape burden exporting requires; we need to invest time in understanding potential markets and what their consumers want; we need to invest energy in targeting those customers with the greatest potential and building long-term relationships; and we need to invest money in our processing infrastructure if we are able to fulfil our ambitions to compete with the best in the world.
Collectively, we need to challenge ourselves and think about where we want to be in 20 years’ time and figure out how to get there because overall, while the consensus was there is space for UK agri-food products on the global stage, it is going to take a lot of hard work and imagination.