Food Industry warns price rise post the Brexit vote

Economy - Himanshu Gill - Dec 09,2016

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food industry warns price rise post the brexit vote

A trade group comprising of 30 food and drink associations have warned that food prices will go up once EU workers leave the UK after Brexit vote or due to the fall in pound’s value.

An open letter was written to the government and signed by these industry groups that represents all major supermarkets and food manufacturers, including the Food and Drink Federation that comprises Marmite maker Unilever and Mr Kipling owner Premier foods. Moreover, the National Farmers Union and British Retail Consortium which counts Tesco, Sainsbury’s, Asda and Morrisons have also signed their concern. 

The letter calls for an ‘unambiguous reassurance’ from the British government about their right to remain. Almost 4 million people in the country are directly or indirectly involved in the food industry, right from harvesting and production to selling the food or drinks. Of them, just under a third of the workers are from the EU.

The trade association emphasizes the significance of these workers and warns that the country’s food security is at risk; stating that a number of workers have already left the country in the wake of Brexit. They appeal the government that it should recognize food industry as important as the automobile or the I.T industry, or else, the UK will face a hike in the food prices along with a scarcity in the food choices.

Last month, the Association of Labor Providers (ALP) said that the UK food industry is facing a shortage of labor as a result of the Brexit vote, adding that the labor shortages had reached the worst levels since 2004. Food companies look for engineers and skilled labor from the EU countries as UK universities are not producing enough graduates in this sector. Also, farms heavily rely on unskilled workers that mostly come from other parts of the EU.

The UK accounts for food exports worth 18 billion pounds every year, with scotch whiskey, chocolate, beer and salmon the biggest exports by value.