UK-EU Reset Unlikely To Cut Food Prices, Warns Industry

Plans by Prime Minister Keir Starmer to lower food prices through closer alignment with EU rules are being met with skepticism across the food and drink sector, with businesses warning the proposals may have little immediate impact – and could even increase costs in some areas.

Speaking during a recent campaign visit, Starmer argued that aligning the UK with European Union (EU) sanitary and phytosanitary (SPS) rules will “make trade easier so there are less burdens for businesses and that, of course, translates into lower prices”.

However, industry figures have challenged these claims, pointing to limited existing costs in key areas and warning of unintended consequences.

Nigel Jenney, chief executive of the Fresh Produce Consortium (FPC), criticised the government’s position, describing its claims as “at best erroneous, if not blatantly untrue”. 

He argued that fresh produce has been wrongly highlighted as a key beneficiary, despite the fact that most EU fruit and vegetable imports are not currently subject to border checks.

While controls on products such as meat, dairy and plants were introduced in 2024, checks on fresh produce were suspended in anticipation of an SPS agreement, meaning there are currently few costs to remove. 

Similarly, checks on goods entering the UK via west coast ports from Ireland were never fully implemented. 

Knock-On Effect For Non-EU Imports

The FPC has also raised concerns about the potential impact on non-EU imports. 

In an open letter to ministers, Jenney warned that adopting EU SPS rules could lead to stricter border controls on goods from non-EU countries, describing such as move as an “act of economic self-harm”.

Jenney said this would mean adopting “unnecessarily stringent” EU SPS controls on non-EU imports, which would risk “thousands of additional and unnecessary border delays, considerably more inspections, more paperwork, and port congestion – every added layer acting as a compounding financial penalty on trade”.

According to FPC analysis, a range of staple non-EU products could be affected, including Moroccan cucumbers, Indian mangoes, South African citrus, and U.S. sweet potatoes, adding an estimated £400 million in costs to the supply chain.

Domestic producers could also face increased regulatory burdens. 

The proposed SPS alignment, outlined by the government in March, covers areas including food safety, labelling, packaging and pesticide use. 

At the time of the announcement, Environment Secretary Emma Reynolds said this would make “trade easier and cheaper, and deliver tangible benefits for British businesses”.

Industry body CropLife has warned that aligning with EU pesticide regulations alone could reduce British farm profits by £810 million in the first year, which would impact on food prices.

The Bigger Picture

The Food and Drink Federation (FDF) has also called for a reassessment of how the agreement is being presented. 

FDF chief scientific officer Kate Halliwell said the deal extends far beyond a conventional trade agreement, describing it as a broader shift in domestic regulation.

While the government has indicated the deal would involve alignment with 76 EU regulations, the FDF estimates that more than 400 pieces of legislation could ultimately be affected. 

“It’s not really a traditional trade deal,” Halliwell said. “It’s not about tariffs, it’s not about barriers and it doesn’t just relate to SPS rules. It’s really a change to our domestic law – and that means that all food businesses need to be aware of it coming.”

Halliwell stressed that this would have implications across the entire food sector, including products made using UK-grown crops treated with substances not permitted under EU rules. 

With a potential start date of mid-2027, industry groups are urging the government to secure transitional arrangements to allow businesses time to adapt. 

FDF’s Halliwell noted that food manufacturers need clarity to ensure crops currently being planted can still be processed and sold under future rules.

Although some organisations, including the British Retail Consortium (BRC), support closer alignment on the basis that it could strengthen supply chains and improve food security, they downplay the likely impact on prices. 

BRC director of food and sustainability Andrew Opie said any savings would be “negligible,” given that the majority of food (70-75%) consumed in the UK is domestically sourced. 

“Anything that comes off costs is a good thing,” Opie commented. “But in proportion to things like energy costs, labour costs or regulatory costs… this is a very small cost.” 

The government maintains that the SPS agreement will deliver significant benefits, including reduced certification, inspection, and administrative costs for exporters. 

It also expects faster movement of goods and less friction at borders, which it says will help ease inflationary pressures.

However, industry voices remain cautious, with many arguing that while alignment may offer longer-term stability, it is unlikely to deliver meaningful reductions in food prices in the near term.

Source: POLITICO