Prime Minister David Cameron: "Welsh food and drink industry better off in reformed EU"

Wales Office

May 11
16:48 2016

  • Leading Welsh food companies Anglesey Sea Salt and meat supplier Dunbia have warned a vote to leave the EU would mean increased barriers to trade with significant unknowns.
  • The Welsh farming and food and drink manufacturing industries employ 81,000 people. These industries exported 270m worth of products to the EU in 2014 91 per cent of total Welsh food and drink exports
  • UK food exports to the EU are worth 11 billion in revenues to the UK economy and support around 40,000 jobs in the food and drink manufacturing sector
  • EU membership gives British food and drink producers unfettered access to free market of over 500 million people.

More than 40,000 jobs in the UKs food and drinks industry will be safer inside a reformed European Union, the Prime Minister said today at event held at Downing Street.

The event, part of the GREAT Britain campaign to drive UK exports, saw leading food and drink companies from across the country, including Welsh suppliers Anglesey Sea Salt and Dunbia meats, show off their best produce.

The Anglesey Sea Salt Company produces Halen Mn Anglesey Sea Salt, which is a Protected Food within the EU. This means that only sea salt from a specific area on the Menai Strait between Anglesey and mainland Wales, produced in a certain way, can be sold under this name across the EU. Employing 22 people, its exports make up over a third of their business, with nearly half of those going to the EU.

Dunbia supply meat around the UK and the EU, employing 4,000 people across the country. Around 20m of their business comes from exporting to the EU, with Welsh Lamb making up over a quarter of this market. The Welsh Lamb they export is also a protected food name across the EU.

Nationally, the UKs food and drink manufacturing industry supports 440,000 jobs and made 11 billion in EU exports for the UK economy last year and the Prime Minister warned that this could be put at risk if the UK votes to leave the European Union on 23 June.

If we were to leave the EU, exporters would face crippling tariffs to sell their goods to Europe such as up to 70% for beef products costing producers around 240million per year. EU tariffs on cheese could cost 153m a year, cereal exports could be hit with a 40m bill and lamb products could face tariffs as high as 42%.

Meanwhile the loss of European protected geographical status would be another blow to the industry. 73 unique UK foods and drinks benefit from European protected geographical status. This protected status helps safeguard some of Britains best-loved great British produce from imitation - from cheese made on Orkney, rhubarb from Yorkshire, to the world-famous Cornish Pasty and helps generate revenues of 900 million.

Prime Minister David Cameron said:

Today I was proud to host some of the finest food and drink producers from across Britain. Their products are popular not just here but across Europe and many of them do significant amounts of trade with the continent. But leaving the EU will rob them of the level playing field and the free access to trade that they currently have.

As we get closer to 23 June and this crucially important referendum, I hope people will focus on what as a country we will get out of staying in a reformed EU and what the costs could be of taking a leap into the dark and choosing to go out on our own. We know that Britains families will be poorer if we left losing out on 4,300 a year.

And the great British food and drink manufacturers I met today are clear that they dont want to gamble their businesses and their employees livelihoods on the roll of a dice that leaving the EU would be.

Secretary of State for Wales Alun Cairns said:

The Welsh food and drink sector is thriving - giving people around the world a taste of the fantastic produce we have to offer from Anglesey Sea Salt to Carmarthen Ham.

With over 80,000 people employed in the sector and 270m worth of exports to the EU in 2014, we need to do all we can to ensure a stable future for our food and drink providers.

Leaving the EU is a very real threat to achieving this and could lead to years of negotiations on new trade deals. Our food and drink sector is stronger, safer and better off within a reformed EU.

Alison Lea-Wilson Director of Halen Mn/Anglesey Sea Salt said:

Staying in the EU means continuity for our existing European business- 34% of our production goes abroad, of which 46% is EU trade; it means continued protection for our Protected Designation of Origin status, and it gives us opportunities for future business on a free and equal footing without artificially high tariffs or even flat bans on exports.

The risks to our business leaving the EU are increased barriers to trade; an end to EU grants to Wales with its low GDP and multiple deprivations, and consequent threats to our environment and lifestyle which in turn would impact on Wales green and clean image, crucial for food and tourism.

The truth is we just dont know what the effect of leaving would be and that its hard enough to run a business without chucking more unknowns into the mix. We employ 22 staff in a rural area, we put 100,000s into the local economy and we work hard in community projects many of which have benefitted from EU grants; who knows how much of these might be at risk.

Managing Director of Dunbia Paul Edwards said:

Dunbia are very proud to be able to showcase prime new season Welsh lamb at Downing Street.

Leaving the EU would leave us with three significant unknowns; future trade policy, agricultural policy, and regulatory policy. Our primary producers especially sheep farmers in Wales are heavily dependent on the support that the EU currently provides to remain in business and the uncertainty of that income post exit from the EU is causing concern.

The UK has an agri-food sector worth almost 40bn, exports are key, and as a member of the EU our goods arent subject to tariffs or border controls. Of the Welsh lamb that is exported 90% goes to the EU and it has been suggested that higher trade costs equivalent to tariffs on exports and imports of at least 5% would become a reality if we left that free market.

On balance, with the uncertainty that would arise, and with the lack of information forthcoming on trade policy post exit we would prefer as a company to stay within a reformed Europe.

Celebrity chef Tom Kerridge also prepared a meal at the event using the products on display to show what home-produced food and drink has to offer the world.

Notes to editors:

  • UK salt production is worth 35m to the economy every year, employing over 500 people, with over 12m exported to the EU. If we left the EU and had to fall back on WTO rules these exports could face a tariff of 170,000 a year, making UK producers less competitive.
  • Welsh lamb and sheep exports to the EU are worth around 100m, about a third of the total UK lamb and sheep exports to the EU. If we left, the lamb and sheep sector would face tariffs of 90m on exports to the EU
  • Welsh exports to the EU benefit from facing no tariffs, and unique Welsh produce are granted a special status which means they cannot be recreated anywhere else, globally.
  • The food and drink industry in Wales had a turnover of 4.3 billion in 2012. In 2014 exports were 302 million, with Ireland, France, Spain, Belgium and the Netherlands as the top 5 destinations.

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