Calm before the storm, Brexit effect only noticeable in the coming weeks

Traffic jams and congestion will limited for the time being, but most exporters agree that the full effect of Brexit will not be seen until after Monday, January 4, when the export of fruit and vegetables starts to increase in volume again after the holidays.

Freight Line Europe has already had 15% extra work on customs documents in the first few days. This is what John de Boom, Brexit specialist at FLE told the Dutch newspaper FD. Although there were fewer problems than expected in the new year, John does expect that more problems could arise in the coming weeks as trade picks up again. What we will now see is whether or not customers are prepared for the new situation.

Dominiek Noppe of Vegro, Belgium, has also noticed that the trade has changed. “If one container contains loads for five customers, then we have to pay an additional 1,000 euros,” he told De Tijd. The import-export document costs the exporter about 200 euros and it takes a lot of extra time to format this document. “On each document should must give details about the fruit and vegetables: what is it, how much is it worth, where exactly they come from and at what price they are sold and that also needs to be done by our customers on the other side of the channel. We have to exchange a lot of information with each other now.”

Dominiek will need to pass on those extra costs to his customers in the long term.

Delays are not a risk, but a certainty
In addition to the additional costs, there is mainly the fear of delays.

"Peppers, aubergines, cucumbers, tomatoes, broccoli - that’s all going to be ok," said Vernon Mascarenhas, commercial director at UK-based Nature’s Choice food company.

"But the finer, the more delicate, the salad heads. Anything above 48, 56 hours [journey time to the UK] we will then start to see a deterioration in the crop and I’d go as far as to say that we might need to rethink things like baby spinach which has got a very, very short shelf life. Baby spinach would not make it, even on a chilled lorry for three days."

Delays are more a certainty than a risk for most people in the industry. “If there is one truck where the papers are not in order at the port, it will affect the entire row,” said Share Brennan, CEO of the Cold Chain Federation.

To avoid delays, a number of trade associations in the Netherlands argue in favour of setting up so-called "green lanes" at the ferries that allow perishable goods to pass faster. Incidentally, the controls in the UK are phased. In the EU they apply from 1 January 2021.

REX declaration and re-export
The UK-EU agreement has prevented tariffs and quotas in trade between the EU and the UK, but that only applies to products that actually come from the EU or vice versa. For composite loads or plant material grown from seeds from outside the EU, a REX statement is required to demonstrate that enough value has been added to the product within the EU. In the case of re-export it is advised not to clear these goods because otherwise you would have to pay twice for customs and inspections.

Yet there is still some uncertainty about this. For example, for products from outside the EU destined for the UK you would have to pay import duties or does a preferential rate apply?.

For example, you would have to pay import duties for products from outside the EU to the UK. "These are levies ranging from 4 to 10-12%," said Philip van Geest of Van Geest International. The charges can be found on the UK government website.

Packaging and Northern Ireland
In addition to the trade of fruit and vegetables, packaging must also be taken into account. Wooden pallets should have been heat treated. This sometimes means extra work to replace pallets if the wrong pallets are used for an incoming load of fruit and vegetables. It should continue to be possible to drive via the United Kingdom for export to Ireland. But it appears that this has not yet been arranged in practice. There are direct ferry services between Ireland and the European Union, but capacity is limited. Special status applies to Northern Ireland; they will remain in the European internal market, but in the practical implementation this will still cause some discussion.

 


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