With the Brexit vote expected to force the departure of the U.K. from the European Union (EU), it is unlikely that the other EU countries will offer the U.K. access to the EU single market forcing them to negotiate with each country separately, according to Forbes. No doubt the issue of allowing EU workers free movement into the U.K. will be a sticking point since much of the fervor leading to the Brexit vote was centered around this issue and immigration.
Of concern for farmers is the loss of the EU’s agriculture subsidies (much like the U.S. Farm Bill) which totaled almost 3 billion pounds to British farmers. The deputy president of the Farmers Union told the Daily Mail that “prices will have to go up to ensure farms stay in profit. Many are already being paid below the cost of production prices and that is not sustainable.” He sees the biggest price increases in fruits and vegetables . In a pre-vote poll of the members of the Food Manufacture Group, 58% of its members thought that staying in the EU would offer greater business prospects. Freshfel, the European Fresh Produce Association reports that in 2015 the UK received imports from an estimated 120 countries of more than 5.6 metric tons of fresh fruit and vegetables valued at over $7.5 billion, over half of those come from the other members of the EU.
It is doubtful that the impact of the U.K. leaving the EU will have much impact on the prices on the imports to the U.S., in fact in the short term there might be some benefits as the British Pound continues its fall against the Dollar.
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