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price hike Brexit could raise your household grocery shop by over €1.3k


Shoppers face an immediate rise in the cost of many staples

Shoppers face an immediate rise in the cost of many staples

Shoppers face an immediate rise in the cost of many staples

A hard Brexit could increase the annual household grocery shop by more than €1,360.

Consumers can expect price increases on a range of foods including cereals, some meats, processed foods, jams, confectionery, chocolate, coffee and a range of other items from January 1, in the event of a hard Brexit.

Figures from the Economic and Social Research Institute (ESRI) show that if talks between the EU and UK this weekend end without an agreement, the cost of tariffs and increased trade costs on the average annual grocery spend could be the equivalent of around €113 a month.

ESRI report author Martina Lawless said the real cost will depend on how much is passed back to the consumer, but she said that products and brands which can only be sourced in the UK may be considerably more expensive in a lot of cases.

Food and drink will account for 70pc of the value of tariffs on imports, and while tariffs vary greatly, consumers can expect a lot of processed foods to be hit with a tariff of 10-20pc.

Fortunately for consumers here, Ireland is a huge exporter of beef, with 90pc of our beef heading to markets abroad. Of that around 50pc goes to the UK and a hard Brexit will see significant tariffs put on Irish beef going into the UK. So there is no chance of a steak shortage on the supermarket shelves here.

However, for beef farmers, a hard Brexit has the potential to be disastrous. Farmer organisations and processors have said the tariffs will make Irish beef uncompetitive on UK supermarket shelves with such tariffs.

When it comes to lamb, Ireland is 335pc self-sufficient in sheep meat and the EU’s largest net exporter. This means there will be no shortage of lamb on supermarket shelves, but as with beef our sheepmeat exports will be facing heavy tariffs.

While Ireland has a strong horticultural sector, we import a lot of vegetables from the UK – mainly onions, cauliflower, carrots and broccoli.

According to one horticultural expert, there should be no immediate price rise, but keeping shelves constantly supplied may mean looking to Europe for more vegetables in the short term, which could add to the cost of some fruit and vegetables.

Ireland imports over 80,000 tonnes of potatoes every year for chips and 6,000 tonnes of seed potatoes. These two areas will be impacted by a hard Brexit, with a shortage of chipper chips expected unless we source new supplies from Europe.

The vast majority of our seed potatoes come from Scotland, but enough should be imported before January 31 for next year’s harvest, so no price rise is expected for potatoes in the short term.

However, in the longer term, Irish growers will need to source new seed potatoes from outside the UK.

Bread shortages, as seen during Storm Emma in 2018, could be one of the first impacts of a hard Brexit and a hike in bread prices is on the cards.

Ireland produces virtually no large-scale milling wheat used for sliced bread and we import 80-90pc of our flour requirements, the majority of which comes from the UK.

A no-deal Brexit means flour will be hit with tariffs that will see bread costs rising by 10-15pc. Further, about one-third of grocery products contain flour so consumers can expect some price rises here.

According to Martina Lawless, breads and breakfast cereals imported from the UK could be hit with tariffs of up to 30pc.

Consumers are unlikely to see any shortages or major price rises for products like milk, cheese or yogurts, unless you’re buying UK dairy products which could see price increases of up to 46pc.

However, Irish dairy farmers and processors will feel a significant impact of a no-deal Brexit, with the UK still the main destination for Irish cheese and butter.

Cheddar cheese will feel the biggest impact as the product is in little demand outside UK and Ireland and 60pc goes into the UK. For farmers, Teagasc has estimated that a no-deal Brexit will hit farmgate milk prices by 7pc.

Fishing rights were one of the key sticking points in the recent Brexit negotiations, with much haggling over who would have what fishing rights in waters around the UK.

Around 34pc of the Irish landings are taken from UK waters, so access to water is a big deal for Irish fishermen. Further, the UK accounts for 64pc of our fish imports and a hard Brexit is likely to see fish prices rise by as much as 17pc.

Consumers with a sweet tooth can expect price rises of up to 27pc on products imported from the UK and given that the UK accounts for 32pc of sugar, jam, chocolate and confectionery imports that could add up in your basket, depending on your brand choice.

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Online Editors