British supermarkets battle to secure stocks as chaotic Brexit looms

- REUTERS, LONDON

Feb 22, 2019-

Britons could face shortages of fresh food, price rises and less variety if the country leaves the European Union next month without agreeing trade terms, food industry officials say.

With no deal in sight as Britain’s March 29 exit date approaches, supermarkets are stockpiling, working on alternative supplies and testing new routes to cope with an expected logjam at the borders but say they face insurmountable barriers.

“You can’t stockpile fresh produce, you haven’t got any space and it wouldn’t be fresh,” said Tim Steiner, head of online supermarket pioneer Ocado.

The warnings, including talk of whether rationing would be needed, are part of a chorus of concern from businesses who say they are weighed down by uncertainty in what was once considered a bastion of Western economic and political stability.

The last time Britain’s food supplies were seriously hit was when fuel protests prompted panic buying almost two decades ago, forcing some supermarkets to ration milk and bread and others to warn that stocks would run

out in days.

Executives within the food chain said Britain was better prepared than 2000, but disruption may be more widespread and last longer than the few days it took before the fuel dispute was settled.

James Bielby, head of the Federation of Wholesale Distributors, says its members’ retail and catering customers were asking for between one and eight extra weeks’ supply. But storage is limited in an industry that operates on a “just in time basis” to maximise the shelf life of goods.

Intense competition and slim margins in the British supermarket sector have also made contingency planning more complicated. James Walton, chief economist at IGD which works with the industry to improve supply chains, said storage had been reduced over many decades to hold down working capital.

What remains is now full. “So surplus space within stores is being used and containers are in carparks,” he said.

Mike Coupe, the boss of Britain’s second biggest supermarket Sainsbury’s, said supplies would not last long.

“We don’t have the capacity and neither does the country to stockpile more than probably a few days’ worth,” he said in January, echoing the supermarket’s warning to then-Prime Minister Tony Blair in 2000 during the fuel crisis.

Britain imports around half of its food, and while some is flown in via air freight, most enters on lorries through Dover, Britain’s main gateway to Europe.

At peak times, 130 lorries a day are required to drive through Dover bringing citrus fruit alone, according to the British Retail Consortium. In March, inclement British weather means 90 percent of lettuces come from the EU.

If it leaves without a trade deal, Britain will move on to World Trade Organisation rules that require tariffs to be paid, goods to be checked and paperwork to be completed, demands that do not currently exist for goods coming from

within the EU.

The English Apples & Pears group said British farms have been asked to provide more apples until the end of April by retailers who usually source more from the southern hemisphere from March.

Other substitutions are more difficult.

“People just say we’ll eat more British produce but ... would people be happy to start eating tonnes of British leeks? I’m not sure,” said an executive at one of Britain’s four major supermarket groups, who declined to be named because of the possible business impact.

“We have to plan for the worst,” he said, before adding that he hoped Britain would delay its departure date from the EU.

Published: 22-02-2019 11:18

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