UK – The duty-free quota for Egyptian strawberry imports into the UK was surpassed on January 5th, much earlier than anticipated resulting in importers facing additional costs and limited alternatives.
In a conversation with Ben Goodchild from Nationwide Produce in December, he highlighted the complexities of the strawberry market, citing adverse weather conditions, reduced UK planting, and a shortage of air cargo space for Egyptian imports as major hurdles.
The subsequent challenge, as predicted, has now materialized in the form of the impending duty on Egyptian strawberries.
The UK imposes a duty-free quota of 6,000,000,000 kg on Egyptian strawberries, with a 10% duty applicable to all imports once the quota is reached.
Contrary to expectations, the quota was fulfilled on January 5th, more than a week earlier than the projected date of January 13th, observed in the previous year.
Ben Goodchild remarks on the implications: “This means that many Egyptian exporters won’t export to the UK unless the client covers the additional cost.”
He further remarked that normally Spain and Morocco would have good volumes by now, and importers would switch to these markets, but Spain started late due to cold weather, and volumes are lower than normal. Morocco has some fruit on the market, but volumes from there are also down.
Importers now face a dilemma—absorb the additional 10% duty from Egypt or incur higher prices for Spanish or Moroccan fruit. Ben predicts potential consequences: “I am sure importers will have made contingency plans for this situation, but I would assume we are likely to see higher prices on the shelves or smaller pack sizes as a result.”
Nigel Jenney, CEO of the Fresh Produce Consortium, sheds light on the historical context of the quota, tracing it back to the time of Brexit negotiations.
Apparently, before Brexit, the EU had a trade agreement with Egypt, which included the UK. At this time, approximately 80% of the strawberry volume arrived in Europe, although its destination was the UK.
However, when the post-Brexit agreements were made, this was not taken into consideration by the UK Government despite documented evidence provided by the FPC.
Expressing ongoing concerns, Jenney states, “We continue to press on a regular basis to have the quota or tariff fundamentally changed as it’s unnecessary. It fundamentally disrupts trade, causes more paperwork, drives inflation, and increases costs for consumers. The UK government is directly responsible for this and leaves importers with very few alternatives.”
Highlighting a potential solution, Jenney suggested that the Government should waive the duty as a short-term fix to improve trade and relations.
In short, consumers want produce, the Government doesn’t want empty shelves, so, this is a self-inflicted and avoidable problem caused solely by the UK Government.
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