Royston Carr Asset Management Says Cost of Food Will Increase Without Brexit Deal
Royston Carr Asset Management - Lack of trade deal with EU could have devastating effect on UK food prices post - Brexit.
TAIPEI CITY, Taiwan, May 31, 2018 (Newswire.com) - Royston Carr Asset Management analysts say the cost of food in the UK is likely to increase if it leaves the European Union without a trade deal and there may even be a risk of a shortage of certain food products.
A recent report by the House of Lords’ European Union Committee has called upon the British government to come up with a detailed plan to ensure food security for the UK after Brexit.
Royston Carr Asset Management analysts say that more than 50 percent of the UK’s food is imported with as much as a third being sourced from the European Union. A further 11 percent is imported from non-EU countries under trade agreements negotiated by the European Union.
Royston Carr Asset Management analysts believe it is highly unlikely that Brexit will have no effect on the supply of food into the UK market.
If the parties are unable to reach a trade agreement, Brexit will probably result in a tariff on food products being imported into the UK of up to 22 percent and while this may not translate to a 22 percent increase in food prices for UK consumers, prices will undoubtedly increase significantly.
Royston Carr Asset Management analysts say that one way to counteract the price increase would be to reduce tariffs on all food imports but this could have the downside of hurting UK food producers who would be unable to compete.
British Prime Minister Theresa May has stated that the UK will not remain in a customs union with the European Union after Brexit but has admitted that the future of food imports without a trade agreement remains uncertain.
Source: Royston Carr Asset Management