Brexit has cost UK food companies exporting to EU an extra £170m | Brexit

Food businesses sending products to the EU have had to fork out an extra £170m in export costs because of Brexit red tape, with the changes described as being “catastrophic” for some exporters.

Data shared with the Guardian shows that in the three years since leaving the single market, exporters of foods of animal origin have had to pay the sums to secure sign-offs by vets before they can send their shipments.

In the past 12 months alone, exporters have paid more than £58m. The extra costs have resulted in a sharp fall in exports, particularly among smaller producers, with the value of meat products sent to the EU down by 17% since 2019.

After the UK officially left the single market in January 2021, the EU made it a requirement for exporters of foods of animal origin to have vets check consignments and sign export health certificates (EHCs) before they could be sent. The UK brought in reciprocal measures last month, raising fears that some EU exporters might abandon exporting to the UK owing to the extra costs and bureaucracy.

Since December 2020, the month before the UK left the single market, more than 852,000 certificates have been requested by exporters, according to analysis by the Sanitary and Phytosanitary (SPS) Certification Working Group, which brings together trade bodies such as the Fresh Produce Consortium, Dairy UK and the Road Haulage Association.

These include certificates for fish and fish products, livestock, and meat and dairy products.

The group calculated that these certificates – which cost about £200 to complete – have heaped more than £170m in added costs for exporters over the past three years.

Peter Hardwick, the trade policy adviser at the British Meat Processors Association, said the extra costs had been “catastrophic” for some smaller companies.

The rules had hurt small businesses most because it was now much harder to send small mixed consignments to the EU, as they did pre-Brexit, because they would require multiple certificates, resulting in far higher exporting costs, he added.

BMPA also calculated that the food exporters, which generally operate on margins of about 2%, will have had to make £8.5bn extra sales just to absorb the costs.

Karin Goodburn, the director general of the Chilled Food Association, said the certificates were just one element of the costs businesses faced and the true figure would be far higher when new IT systems, administration costs and extra staff were factored in.

Goodburn, who is also the chair of the SPS group, said: “We’ve had companies employ extra staff to do the new bureaucracy, one of my members had to employ 30 new staff just to shift the paperwork.”

The figure for the extra costs comes as data from the Office for National Statistics last week showed the amount of meat products exported to the EU from the UK in 2023 totalled £1.26bn, a 17% drop from the £1.53bn exported in 2019.

This was the second-lowest figure in the past decade, with the lowest coming in 2021, the year after the rules came in, where £1.13bn of meat products was exported. That year’s figure would have also been affected by Covid-19 restrictions.

Hardwick said many bigger companies had no option but to take the hit with these new costs, and this was resulting in smaller profits, or, in some cases, higher prices for consumers.

He added: “For some [smaller] businesses that has been terminal. I say terminal, not that they have gone out of business, but that it is just not worth their while in exporting any more.”

Last month, the UK brought in new export health certificate requirements for EU companies exporting products of animal origin into the UK as part of its Border Target Operating Model changes.

The Guild of Fine Food, which represents 12,000 independent food businesses, said small European suppliers of cheeses and meats could give up on sending goods to the UK.

However, British farmers welcomed the change as it gives them an advantage over foreign producers in the domestic market.

Labour has said that if it gets into power, it will aim to strike a veterinary agreement with the EU, which would remove the need for some of these costs but could take years to finalise and would require the UK to agree with EU standards on these goods.

Goodburn said the UK had led on food hygiene legislation across Europe for the three decades during which it was in the EU single market.

“So, we helped create the laws, we led on packages of the hygiene law, and now it’s been deemed through the deal that we comply with it.”

The Department for Environment, Food and Rural Affairs has been contacted.