MORE EXPENSIVE AND MORE COMPLEX: BREXIT FORCES TO REDESIGN THE FOOD SUPPLY CHAIN

Witness of the logistical complications posed by the new relationship between the United Kingdom and Europe, this territory has been one of the first to feel the effects of an agreement that, according to the Food and Beverages Federation (FDF), will generate an increase in prices in the short term and will force redesign of food supply chains in the long run.

The exponential growth of bureaucratic procedures, they point out, will be the main trigger of these changes "at forced marches", whose costs "will be transferred to consumers or absorbed by retailers", as Ian Wright, executive director of the FDF, clarified .

Over the next six to nine months, "unless there is a material change in the agreement reached, we will see the reengineering of almost all supply chains between the European Union and the United Kingdom, as well as between Great Britain and Northern Ireland" , clarifies.

First signs of change: out of stock

According to Wright, "in the short term, the costs and the time lost for the supplies to reach the shelves will cause the temporary shortage of some products, which in the long term will force to assume quite significant changes, with their respective expenses."

Passing these costs on to consumers, they say, would ultimately be left to the retailers. Predictably, given the narrow margins with which they operate and the accumulated challenges facing the closure of the hospitality sector, manufacturers and distributors of mass consumption will not be able to absorb the increases that will result from the new customs processes, says Wright.

The FDF executive criticized the bureaucracy that the sector now faces when it tries to manage exports from the United Kingdom to the European Union, where he says that a company that used to take 3 hours to fill out the paperwork, can now take up to 5 days .

The special situation of Northern Ireland

The British Retail Consortium (BRC) warned of possible additional shortages of some products in Northern Ireland supermarkets.

Andrew Opie, BRC's director of food and sustainability, said a significant disruption could be expected for supermarkets moving produce from Britain to Northern Ireland from April, unless the government updates the current 'grace period' which exempts the European Union, for three months, from completing all certification for products of animal origin.

"Northern Ireland is a particular problem, there is no question about that, and a particular problem for UK supermarkets," said Opie. "If we don't find a viable solution for retailers in the next few months, we will face a significant disruption in Northern Ireland."

Source: Logistics Notebooks vía DGCI

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