A leading wine wholesaler has calculated that Brexit is adding an average of more than £1.50 to the cost of every bottle of European wine he sells to consumers.
The warning comes as the UK faces a cost of living crisis, with inflation running at 9 per cent and expected to top 10 per cent by the end of the year.
Daniel Lambert, whose south Wales company was named International Wine Challenge small agent of the year in 2019, said that Brexit had caused “huge disruption” to his business since the UK transitioned out of the EU at the start of 2021.
Some 18 months after the switch to post-Brexit arrangements under Boris Johnson’s Trade and Cooperation Agreement (TCA), Mr Lambert said it was now possible to establish a true financial picture of the impact of the change.
A long-standing critic of EU withdrawal, he said it was clear that the additional paperwork and delays created by Brexit had imposed a permanent increase to the cost of doing business, while delivering no benefit to his company.
Writing on Twitter, Mr Lambert said that the average cost for importing wine from major European producers such as France, Italy, Spain and Germany was between £170 and £190 for a pallet of wine.
Order, collection and delivery of a pallet, containing an average 672 bottles, typically took seven to 10 days from any part of the EU, which makes up two-thirds of wine consumed in the UK.
Following Brexit, he said that lead times from order to delivery of shipments have stretched to as much as 21 days from Spain, 26 days from France, 35 from Germany or Austria and 45 to 70 from Italy.
The best rates his company has been able to find for imports are £270 for a single pallet from Spain, £280 from France, £310 from Germany, and £340 from Austria or Italy.
Charges from brokers for new paperwork on either side of the Channel can add anything between £25 and £150 to every import and export document, said Mr Lambert, though he said he was able to save an average of £65 on each consignment by doing some of the forms himself.
The overall additional cost for logistics and paperwork has made importing a single pallet of wine from Spain £155 more expensive than before Brexit, £165 more from France, £180 from Italy and £150 from Germany or Austria, he calculated – the equivalent of 25p on every bottle.
On top of this is the cost of an extra member of staff hired purely to deal with Brexit-related paperwork, which adds another 13p onto the cost of each bottle, he said.
The new unreliability of delivery times has forced Mr Lambert to increase the stock he holds in order to be sure not to run out of particular products, adding an estimated 20p more to the average cost of a bottle.
“So our costs have increased, with zero benefits to anyone, by 58p a bottle,” said Mr Lambert. “Once margins are applied at the usual wholesaler and retailer percentages this 58p becomes over £1.50 a bottle for no benefits to anyone, and it’s you the consumer that’s paying this.”
Disruption to supply chains in the wake of the Covid pandemic has dramatically increased lead times and shipping costs for wines from producers such as Australia, giving EU bottles an even firmer grip on the UK market, he said.
“My conclusion is very simple,” Mr Lambert. “No matter how many free trade agreements the UK gets, the one with our nearest neighbours is the most important.
“You can’t argue against geography, and the global Covid reboot clearly shows this. We live in a just-in-time world – Brexit is the exact opposite.
“Moreover, in a world where we need to use less energy and reduce CO2, buying locally matters like never before. So the obvious answer is stronger relationships with your nearest neighbours. It really is as simple as that in my opinion.”
