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The Wine and Spirit Trade Association warns if Brexit ‘doomsday’ dawns Britain could be faced with a gin drought.
The Government has drawn up a scenario for a no-deal Brexit said to paint a frightening picture of food and ingredient shortages – if the worst-case scenario becomes a reality this could lead to a juniper shortage.
British distillers rely on tonnes of juniper and other botanicals being shipped to the UK each year, predominantly from the Mediterranean.
Other commonly used botanicals found in gin include orange and lemon peels, liquorice, orris root and angelica root – all of which are generally imported.
If the ports collapse and goods can’t get through some of the UK’s smaller craft gin distillers will be facing extremely testing times.
The gin boom has seen a huge rise in the number of start-ups and distilleries making the juniper based spirit. Britain now boasts 315 distilleries in the UK – more than double the number that were operating across the country five years ago.
The WSTA’s latest market report released this week shows UK sales of gin have hit yet another record high.
In the 12 months to the end of March 2018 almost 55 million bottles of gin, worth almost £1.5 billion – up 28% in volume on the same period last year and 33% in value.
This of course is just one example of the headaches facing the wine and spirit industry, a trade which relies on the smooth transition of goods across borders.
Wine businesses face similar nightmare scenarios. 99% of the wine sold in the UK is imported and if stock cannot get in this will lead to depleted supermarket shelves and higher prices for consumers.
The UK wine trade is worth £19.9 billion in economic activity. We imported just under 1.8 billion bottles into Britain in 2017, 900 million of those bottles – 50% – come from the EU.
The dilemma facing wine trade is they need to have a contingency to double their wine stocks, which means finding extra warehouse space and cash flow, at a time when banks are being more cautious lending to British businesses.
Miles Beale, Chief Executive of the Wine and Spirit Trade Association said:
“The British gin industry is a great example of a booming trade that could be severely hampered if the so called ‘Brexit Armageddon’ scenario strikes. Doomsday Brexit could have a catastrophic impact, certainly on some of the smaller gin distillers, who are likely not to have the capacity to buy in and store reserves to make their products. This could lead to a shortage or even wipe out your favourite craft gin. The whole of the UK wine and spirit trade relies on the frictionless movement of goods in and out of the UK. We have been warning our members to prepare for the worst for the last 18 months. Government seem to have only just woken up to facing the bleakest outcome.
The harsh reality is that Armageddon risks companies going under, jobs being lost and consumers facing price hikes. So, Parliament needs to debate and pass the EU withdrawal bill and the government needs to get on with negotiating a successful trade deal with the EU that can be delivered in time for the end of the transition period. Businesses in our industry need a frictionless, fudge-free fix – and they need it fast.”
Dan Szor, Founder of the Cotswolds Distillery, said:
“If we are faced with a trade dead-stop at customs it is going to cause chaos at UK ports. Businesses like mine will find it very tough. We need clarity from government so that we can start to make a plan. At Cotswolds Distillery we rely on juniper berries from Macedonia – and it comes into the UK via Calais. without juniper there is no gin. Juniper grows wild and the success of the harvest is very much weather dependent, if we have a bad season and distillers are being forced to stockpile and I can see a juniper war kicking off. It’s not just SME’s like ours that will suffer the situation isn’t resolved it’s all millions of gin lovers who might not be able to get hold of their favourite tipple if juniper is in short supply.”\
Cathy Caton, one of the founders of Brighton Gin, said:
“We are a small-scale producer where every single element of our production is done by hand – our recipe is measured out in grammes rather than kilos! We neither have the purchasing power of the big producers and nor the storage space to stockpile juniper. We are already noticing supply issues and are guessing that the bigger players are buying up stocks to secure them – something we’re not in a financial or physical position to do.”
In November 2016 the WSTA published their Brexit policy paper – ‘The road ahead for the wine and spirit industry’ – drawn up to establish how best to meet and exploit the challenges of leaving the EU.
Since then we have been warning WSTA membership, at a series of Brexit briefings, workshops and Brexit risk map to have a contingency plan.
• Advising to prepare for stockpiling and storing goods, ingredients and equipment
• Booking slots on Eurostar
• Prepare and know how to report bootlegging and fake booze coming onto the black market
Last year the WSTA highlighted importers and exporters concerns that if no resolution on leaving the customs union would see more than double the volume of cargo subject to inspection at British ports.
All ports’ operations are designed around the “just in time” principle, so there isn’t the capacity for hold ups.
If Brexit talks don’t achieve frictionless borders ingredients will be held up in transit, bootleg booze could flood Britain and the roads into UK ports will become a lorry park.