An ICF survey commissioned by the UK’s Department for Environment, Food & Rural Affairs (Defra) found that food and drink SMEs trading with the EU reported lower profitability ahead of leaders’ review of bilateral ties. These results add a small-business perspective to negotiations over rules governing cross-border food trade between Britain and the EU.
ICF surveyed 600 food and drink manufacturing SMEs in England, Scotland and Wales. Among firms trading with the bloc, 55% of exporters and 47% of importers described profitability as lower after EU trade requirements took effect in January 2021. The findings record firms’ own accounts and do not show whether the rules caused the reported declines.
Separately, a subset of SMEs that had ended EU trade since 2021 identified Brexit as a major reason: 69% on the exporting side and 55% among importers. On export support, respondents put reduced paperwork at 79% and lower trade costs at 78%, followed by fewer border delays at 71%. Importers gave those options 68%, 65% and 64%, respectively. On guidance, 71% of exporters and 61% of importers rated it extremely or very influential.
Defra said family-run and other small firms have less capacity to manage the expenses and disruption associated with paperwork and border inspections. Environment Secretary Dame Angela Eagle said such firms were “stuck in paperwork.”
Defra said the government is negotiating a new UK-EU food and drink agreement. In the survey, 58% of respondents thought an agreement could help them launch, restart or expand EU exports over the coming year; half saw a similar benefit for imports. Those figures represent expectations, not observed trade outcomes.
The European Council says leaders will meet in Brussels on Friday, Nov. 20, to assess progress in UK-EU relations, including agrifood rules, and discuss next steps.
