UK price competitive on world stage

Published 11 February 16

At the AHDB Outlook conference this week, Andrew McLay reported on a recent study from Promar looking at the competitiveness of UK agriculture on the global stage. The study conclusion is that the UK can be price competitive, provided it has a level playing field to play on in terms of trade agreements.

Focusing on dairy, although the UK tends to have higher cost of production than some global competitors, such as Australia and New Zealand, it gains from favourable freight rates. As a result, the overall costs to deliver to countries in the Middle East and West Africa from the UK are favourable when compared with the overall costs from Oceania and the Americas.

Concern was raised about the increasing number of Free Trade Agreements (FTAs) being negotiated, mainly because the EU has tended to lag behind in FTA development. FTAs have the potential to give a significant advantage to specific countries in terms of import tariffs. According to Promar, for a number of dairy products it is often only the difference in import tariffs from FTAs that mean the UK struggles to compete on price.