Food companies that use the UK as a distribution hub for deliveries between mainland Europe and Ireland will face additional costs and paperwork due to the Brexit. As a result, food deliveries will come under pressure.
Industry associations from both the EU and the UK warn about this in the Financial Times. Many European food companies send their products for the UK and Ireland - which is still a member of the EU - to the same distribution centres in the UK. Irish companies often do the same for products destined for mainland Europe, with the new trade rules stipulating that those products come from the UK due to that stopover.
A major EU supplier, who wishes to remain anonymous, told the newspaper that this extra cost applies to around 30 trucks a week. Those trucks contain food products from mainland Europe that are shipped to Dublin.
Extra trucks and higher prices
These rules are likely to cause companies to stop delivering to Ireland, says Dominic Goudie of the UK industry body Food and Drink Federation. "It adds significant extra costs and complexity for EU and UK producers who need to restructure their supply chains," Goudie said. He expects it will put more trucks on the road and increase consumer prices in both the EU and the UK.
Adapting to new situation
An EU official believes the food industry needs to come to terms with the new situation. "The UK will no longer be a distribution hub for the European Union." Transportation of goods between Ireland and the EU is more likely to be via direct ferries in the future. These sail between Ireland and France.
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