The fruit and vegetable sector in Spain were rightly concerned about the impact of Brexit, however the employer association FEPEX, has reported that exports to the UK are up. The Valencian Community in particular, has enjoyed good growth in sales over the past year.
According to FEPEX, the value of fruit and vegetable exports to the UK rose by 11% in 2021 to more than 15.2 billion euros. This despite the imposition of tariffs and border controls.
Fruits, citrus, wine and olive oil continue to be the best-selling foods benefitting from the exit agreement, which limited tariffs of these products into the UK. Had the agreement not been in place the added cost of exports would have exceeded 198 million euros under WTO rules. That could have dealt a fatal blow to the industry.
This is good news for Spain with exports having grown despite all the obstacles, from Brexit to the pandemic to labour shortages.
EFEAGRO has at the same reported sales of food, beverages and tobacco to the United Kingdom of 345.02 million euros in October, which means a rise of 0.29% so far this year. Although that is an increase for the year so far, sales in October were down 2.2% compared to the same month last year according to the latest foreign trade data published by the Ministry of Industry, Commerce and Tourism.
The Spanish citrus sector, with exports of just over 107,000 tons between September and December 2021, also experienced a slight drop in comparison to the same months last year.
Jorge Brotons, Chair of Fepex, chaired, says that the UK remains the third larghest market for the fruit and vegetable business. Although sales have grown so too has the competition countries such as Morocco, Egypt, Turkey and South Africa in a position to supply the same products. Morocco have according to Brotons, announced their intention to increase exports to the UK by as much 650,000 tons more than the last season.
Cost are rising
Exports of Spanish fruit and vegetables to countries other than the UK grew by 4% in 2021 according to FEPEX, they do however say the industry is facing some serious challenges. Included in these challenges are the new CAP, the green transition and the growing globalisation of the fruit and vegetable market.
Although sales turnover was up actual volumes only rose by 1% according to FEPEX.
The UK introduced full border controls on January 1st which may hamper exports into the country, with increased paperwork and checks likely to impact trade.
The additions to CAP by the EU will also see direct aid to farmers being restricted from 2023, the additions designed to level the playing field further within the EU. These changes will limit the ability of governments to introduce sectorial interventions.
Brotons says that imports into EU far exceed exports and that: “This imbalance is becoming more and more acute because imports are not subject to the same production, environmental and social requirements as Community productions, making the Community model less and less competitive compared to third countries.”
Finally Brotons says that efforts to improve the competitiveness of farming in Europe will benefit those whose industries are more advanced technologically, and will in turn harm countries like Spain who use more traditional methods.
Whilst it is good news that Spain’s fruit and vegetable exports to UK are up, it is clear that the farming and food industry is facing many challenges that will need to be overcome to retain market share let alone increase sales.
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