Forex Trading Library

NFU Warns That UK Will Run Out of Food In One Year Under A “No -Deal” Brexit

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As the Brexit negotiations rollercoaster continues to peak and trough, the National Farmers Union have now fuelled further panic by hitting headlines with a report that claims Britain would run out of food within a year if it was forced to be self-sufficient. The president of the Farmers’ Union Minette Batters requested that the government placed food security at the top of its political priorities, given the increasing possibility of the UK leaving the EU without a formal deal.

Batters said, “the UK farming sector has the potential to be one of the most impacted sectors from a bad Brexit – a frictionless free trade deal with the EU and access to a reliable and competent workforce for farm businesses is critical to the future of the sector.” These comments are particularly worrying given recent comments by Brexit secretary Dominic Raab, who said that the UK would have “adequate food supplies” after Brexit.

Uncertainty and fear regarding the negotiations, has been increasing recently and while the government continues to reassure the public that an agreement can be achieved, the international trade secretary Liam Fox issued a warning over the weekend saying that the chances of a “no-deal Brexit” were now around 60%.

Decline in Food Security

The issue of food security is a controversial one. Food security has been in long-term decline with only 60% of the food needed for the UK, actually produced within the UK itself. This 60% is down sharply from 74% 30 years ago, according to data collected by Defra (Department for Environment, Food and Rural Affairs). One big cause for the decline is the change in eating habits over the last thirty years with an increasing reliance on foreign-produced food, especially for perishable items such as tomatoes, lettuce and citrus fruits which many shops stock all year round.

However, shifts in the global economy have also affected the foods that can be grown in the UK causing a skew. For example, although the UK is a net exporter of meat, data from the Agriculture and Horticulture Development Board shows that the UK relies heavily on imports of meat such as Bacon from Denmark.

August 2019 End Date

The statement released by Batters refers to research collected by the NFU which shows that the UK would run out of food by August 2019 in the case it needed to be self-sufficient. 7th August is the “notional date” given as the exact time food will run out.

However, Batters did say that the negative impact of the UK leaving the EU without an agreement could be mitigated if the government took action right away and offered “unwavering support” to domestic producers.

In terms of the food categories which are most at risk, data from Defra shows that fruit is at the top followed by vegetables, with 57% of the UK’s required amount produced in Britain, followed by pork at 61% and potatoes, of which 25% are imported.

Batters said, “the statistics show a concerning long-term decline in the UK’s self-sufficiency in food and there is a lot of potential for this to be reversed… And while we recognize the need for importing food which can only be produced in different climates, if we maximize on the food that we can produce well in the UK, then that will deliver a whole host of economic, social and environmental benefits to the country.”

While the market impact of such a release might not be too significant, news releases such as these, show a worrying escalation in levels of uncertainty that are attached to Brexit negotiations and the fear that a deal won’t be achieved.

Technical Perspective

EURGBP continues to move within the bullish channel running from 2018 lows and is currently challenging the .8959 – .8968 resistance, which has seen strong selling pressure on the two occasions it has tested the level so far this year. If prices can sustain a break of this level, the next focus point will be the .9022 – .9032 level resistance which was the October 2017 high.


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