The trade body behind a shocking report that warned at least 32,000 jobs could be lost if the UK crashed out of the single market without a deal has said companies could face liquidation too.
“Both EU and UK businesses stand to lose hugely in the event of a hard Brexit,” the European Livestock and Meat Trading Union (UECBV) told GlobalMeatNews after it released its EU Meat Industry in a Hard Brexit Scenario: Crisis report this week.
“It is no exaggeration to say that such a result would be catastrophic for the entire meat industry in Europe.”
Tariffs, vet checks and higher costs
UECBV does not have estimates for the number of businesses that could go into liquidation after Brexit. However, it stressed “producers will have limited ability to absorb higher costs” given the “low margins on meat products”.
Huge tariffs rises – up to 100% for manufactured beef – and the cost of veterinary checks, customs costs and longer transport times would mean many meat businesses in the UK and the EU would have extra burdens to handle. This could see them “forced out of business”, UECBV warned.
UK businesses could be put at a serious competitive disadvantage by losing out on trade deals with third countries that have agreements in place with the EU. This would make it “extremely difficult” to find alternative markets for hard-to-sell products.
Germany and Denmark could face the massive problem of finding new markets for high-value cuts, such as bacon and steak, which the UK imports in huge quantities.
UECBV warned it would be “almost impossible” for major EU exporters of bacon and steak to the UK to find markets that import bacon on the scale that Britain does.