The cost of a pint of milk could rise unless Brexit negotiations settle a trade and labour deal, the UK’s dairy farmers have warned.
The industry – which employs more than 70,000 people – said Britain leaving the EU without striking a deal and having to resort to World Trade Organisation tariffs would be “the worst outcome”.
Calling Brexit a “monumental and game-changing challenge”, Paul Vernon, chairman of trade body Dairy UK, said the industry has “tremendous potential for exports and product development” if a deal can be reached.
Without such an arrangement, he warned of “far-reaching consequences” for the sector, which generates an annual turnover of almost £28bn.
“The stakes could not be higher and there is a fine balance between creating a climate where we can seize the opportunities that Brexit may present and being left with seriously detrimental trading conditions,” Mr Vernon added.
In a “white paper” on the sector, Dairy UK said it wanted continued free trade between Britain and the EU, saying tariffs would damage exports and reduce demand.
Other demands included an “unhurried” transition to whatever arrangements are put in place as a result of leaving the EU to allow the sector to “adapt and take advantage of Brexit”.
A further concern is that without continued access to both skilled and unskilled labour, costs could spiral, hitting margins and potentially pushing up prices.
The white paper also revealed that despite the uncertainty caused by impending Brexit, investment by companies in the sector stands at a rate of more than £100m a year.
It also examined the public’s understanding of and support for the dairy sector. Key findings included that spending is rising on the full range of dairy products: milk, cream, cheese, yogurt, butter and organic produce.
Despite a growing range of alternatives, 87pc of consumers drink cow’s milk and 94pc of adults buy cheese, according to the research.
Source: The Telegraph