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EU producers must support UK to deliver best Brexit outcome

Published:  14 February, 2020

European wine producers should join their UK counterparts in lobbying their own MPs and the EU to deliver the most favourable post-Brexit trading environment.

This was a key message delivered by the Wine & Spirit Trade Association's chief executive officer Miles Beale, speaking at a Harpers-hosted conference at Wine Paris this week.

Beale was addressing the session’s central question, ‘Will there be a Winexit in the UK?’, which opened with an address by consultant Anne Burchett, highlighting the headwinds currently faced by the UK trade.

“A lot of consumers are vaguely aware that things are going to change after Brexit, but not fully, so the cost is going to possibly come as a shock,” said Burchett.

“Producers from the EU will have to be prepared, nimble, agile and reactive, if they want to keep the lion’s share of the UK market.”

Beale picked up the baton, delivering a compelling argument for moving beyond a situation where “the UK wants this, and the EU wants that”, shifting instead to a position where “we think much more about what the industry wants, and persuading our politicians to deliver it” – on both sides of the Channel.

He reminded the audience that the UK remains the second biggest wine importing market in the world by both volume and value, of the very international nature of that market and of the continued strong demand for wine - notwithstanding an ongoing trend for consumers to drink slightly less, but to spend up when they do indulge.

Beale added: “The real difficulty with Brexit is ‘how?’- how do we ensure that the demand and supply are as joined up in 10 and a half months as they are now?”.

“It becomes more challenging, so the industry needs to be lobbying politicians, wherever they are based, London, Brussels, Paris, etc, to facilitate trade. No consumers have signed up for less wine, less choice, poorer quality and more expensive, so we want politicians to facilitate trade.”

“The key thing for us here is to try and work out how to ensure that trading is no more difficult, or at least only a little more difficult, than it is currently.”

The dangers for EU producers in terms of upset to their share of the UK market, with European wine currently accounting for around half of UK imports, was highlighted by John Chapman, operations director at Oxford Wine Company.

“At the moment everything is looking flat and the willingness to want to move away from any European wine is not in the common interest,” said Chapman.

“The business I buy for is very much focused on the medium to fine end [of wine]. But at the lower end of the market, at the £5 to £6 level in the UK, we as a business have had to look at what we can do to minimise the possible disruption in January.

“European wine makes up about 75% of our imports. New World is important, but [with unfavourable trading conditions] it would have to be a massive increase and movement of volume lines to the likes of Australia, Chile and even Argentina, which are now on the horizon,” he warned.

Chapman added that the business didn’t want to and anyway couldn’t move away from the higher end of Europe - “the Burgundies, Bordeaux and higher end Italian wines” - but would have to somehow absorb any higher tariffs, highlighting the resulting impact that would have on both importers and, potentially, producers if sales fall.