Smallest U.K. Wheat Crop in Decades Raises Brexit Supply Worries
Smallest U.K. Wheat Crop in Decades Raises Brexit Supply Worries
(Bloomberg) -- The U.K. is reaping its smallest wheat crop in at least three decades, increasing reliance on imports just months before Brexit threatens to raise costs or disrupt flows into the country.
British farmers were pummeled by a season of weather extremes, as record winter downpours cut plantings before spring dry spells then hurt young crops. That means the wheat harvest will probably slump 38% to 10.1 million tons, the smallest in data going back to 1984, the government said on Monday.
The shrinking supply means Britain will need to import more to meet demand just as the transition period to depart the European Union expires at the end of the year. Purchases from the bloc -- typically the top supplier -- could be subject to steep tariffs without a trade deal, and there’s the risk of chaos at ports as goods being imported without the right paperwork are turned back.
Buyers are already “trying to secure all they can,” with cargoes arriving from the Baltic states and Germany, in case supply becomes restrictively expensive next year, grain trader Frontier Agriculture said in a note last week.
The U.K. and EU over the weekend agreed to step up negotiations for an accord, though both sides acknowledge there are still significant divides to bridge with less than two weeks before Prime Minister Boris Johnson’s deadline to secure an agreement.
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