MoveS to improve and expand the potential for UK exports to China post-Brexit have been hindered following a decision by Defra not to fund inward inspection costs.
As part of the export process, the Chinese Government require the cost of inspecting the UK dairy sector to be financed by the UK. This includes travel, hotel and subsistence costs and is estimated to be around £45,000.
Defra maintain that the funds for inward inspections should be provided by the ‘benefitting sector’ but there is concern that the benefits gained will be spread wider than between those paying for the inspections. Moreover, at present, the vast majority of UK dairy exporters are small companies and the costs of inward inspections are significant.
Defra state a commitment to ‘supporting our food and drink industry grow more, sell more and export more British food’. However, an essential part of Brexit preparedness is the financing of inward inspections.
Whilst the Chinese market is a relatively small market for UK dairy exporters, the market represents a growth opportunity. According to AHDB, China accounted for 26 per cent of the world’s dairy imports in 2017 and China continues to be a key determiner of global dairy commodities prices. At present, almost all of China’s dairy imports are supplied by New Zealand, the eU-28, the USA and Australia.