FDF Cymru, alongside nine other Welsh food and drink producers and manufacturers, have written to Prime Minister Boris Johnson highlighting key issues that need be addressed to avoid ‘detrimental impacts’ to the industry following the end of the transition period.
Many Welsh food and drink businesses rely on the United Kingdom’s relationship with the European Union to sustain production of their products. The European Union is the largest market for Welsh food and drink businesses to export their goods to, and includes exports of red meat and dairy products worth an estimated £320 million to Wales.
What happens in the next six weeks is therefore critical to the survival of many food, drink and farming businesses and the supply chains and jobs they support. The following six actions are said to be essential for food and drink producers and manufacturers in Wales:
- A trade deal allowing tariff free access to the EU market must be reached if acute and long-lasting damage to our industries is to be avoided. With EU Most Favoured Nation (MFN) tariffs for key Welsh food exports set at values which can often be in the range of 40%-85% of the value of a product – failure to reach a trade deal would devalue our exports to levels well below production costs, having a devastating impact on our businesses and our livelihoods.
- A six-month grace period should be negotiated and agreed with the EU to allow businesses to adjust to the impacts of the new rules which will be in place for exports – many of which remain unclear – even in the event of a trade deal being agreed.
- Efforts to reduce the impacts of non-tariff barriers must be stepped up, both in terms of the actions that can be taken unilaterally by the UK and what is negotiated with the EU, including a reduction in the frequency of physical checks at borders based on trusted Third Country status. Non-tariff barriers will in any case represent significant additional costs for Welsh businesses, while also threatening deliveries and values of perishable goods produced in Wales, it is essential that such impacts are minimised.
- The food and drink sector must be added to the Shortage Occupation List while taking meaningful steps to improve access to seasonal workers. Skilled and unskilled workers, especially from the EU, play a central role in Wales’ food and drinks sector and restrictions on access to such workers after 31st December 2020 would cause major additional challenges for Welsh businesses and even the future of some processing facilities in Wales that provide large numbers of employment.
- Appropriate physical infrastructure and staffing at UK ports must be in place at the end of any transition or grace period to ensure the smooth flow of products, negotiate agreement with the EU to ensure the same in UK-facing ports while including agricultural and fish products in the priority list for processing at ports due to its perishable nature.
- Financial assistance packages for food and drink producers and manufacturers must be put in place ahead of any changes to trading arrangements to fully make up for the additional costs and significant losses anticipated in the majority of post Withdrawal Period scenarios, especially for our most vulnerable sectors.
The letter was signed by the British Meat Processors Association, CLA Cymru, Farmers’ Union of Wales, Food and Drink Federation Cymru, Livestock Auctioneers Association, National Beef Association, NFU Cymru, National Sheep Association Cymru/Wales and the Royal Welsh Agricultural Society.