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Saturday, 28 July 2018

British food stores ridicule Brexit stockpiling plans (FT)

Subtitle: "Retailers say they have had no government contact over no-deal supplies"

"Britain’s grocers say they have had no contact with the government about stockpiling food in anticipation of the UK crashing out of the EU in March without a withdrawal deal and have ridiculed suggestions it is their responsibility to begin the process.

Dominic Raab, Brexit secretary, said this week he would ensure the UK had “adequate food supplies”, but implied it was the responsibility of the industry: “It would be wrong to describe it as the government doing the stockpiling,” he told MPs. 

But one supermarket chief said the government’s position was “ridiculous” and demonstrated “complete naivety” about the way the sector worked. Ian Wright, chief executive of the Food and Drink Federation, said: “I would very much welcome a conversation with the government.” 

The possibility of food shortages has become a political issue in recent days, as ministers have ramped up preparations for major disruption at UK borders if Britain leaves the EU on March 29 2019 without a deal. 

Senior executives at several major UK companies have begun to voice alarm at the prospect of a no-deal Brexit following Theresa May’s inability to win consensus among her governing Conservative party over a compromise plan with Brussels. 

The EU has also begun to warn of the possibility of failing to reach a Brexit deal, with Michel Barnier, the European Commission’s lead negotiator, casting doubt on the prime minister’s plan to keep the UK within the EU’s customs system for goods. 

“We have doubts it can be done without putting at risk the integrity of the customs union, our common commercial policy, regulatory policy and fiscal revenue,” Mr Barnier said after meeting Mr Raab in Brussels

France’s Europe minister, Nathalie Loiseau, on Thursday raised the possibility of a “brutal divorce” with the UK and EU separating amid acrimony and without any deal in place at the border. 

“With no deal, we should start with new tariffs, new controls and that means — of course — traffic jams in Calais and in each and every European port welcoming goods and people coming from the United Kingdom,” she said. 

Even if Britain left its borders open to allow imports from the EU, ministers are braced for the imposition of controls in Calais and other ports for traffic heading from the UK that could quickly bring all cross-channel traffic to a halt. 

Ministers are already drawing up plans to close the M26 motorway in Kent to turn it into a vast lorry park in the event of a no-deal Brexit, raising questions about the availability of food: some 40 per cent of the UK’s foodstuffs are imported. 

“Stockpiling of food is not a practical response to a no-deal on Brexit and industry has not been approached by government to begin planning for this,” the British Retail Consortium said in a statement

“Retailers do not have the facilities to house stockpiled goods and in the case of fresh produce it is simply not possible to do so. Our food supply chains are extremely fragile.” The BRC said it was vital to find a deal to maintain frictionless trade. 

The senior executive at a large British supermarket chain said the government had not talked to the industry about maintaining food supplies and accused ministers of misunderstanding how supply chains function. 

“It’s ridiculous,” the executive said. “It’s scary because it shows how far the government is from the reality of how things work. It’s genuinely worrying.” 

Supermarkets say they operate a sophisticated “just in time” supply model. Fresh food could not be stockpiled for more than a few days, while there was not enough warehouse space to hold large quantities of non-perishable “ambient” goods. 

Government officials said there had been tense meetings in Whitehall to work out how to answer questions about the “stockpiling” question, before alighting on a line which asserts simply that Britain will not run out of food. 

“As the Brexit secretary has made clear, we have no plans to stockpile food,” said a government spokesman. “The UK has an excellent level of food security, built on access to a range of sources including strong domestic production. This will continue to be the case as we leave the EU, whether we negotiate a deal or not.” 

Some retailers have said privately they are making arrangements so that should supplies from the EU be disrupted, they would have plans in place to import from elsewhere. 

When floods in Spain last year washed out a large proportion of lettuces, supermarkets were forced to ration supplies and then to import from South America. “This is the sort of contingency planning taking place — you certainly can’t stockpile salad,” said one retailer."

Source: https://www.ft.com/content/13acf2c0-90e4-11e8-b639-7680cedcc421