// Tesco boss John Allan warned that tariffs on some food products are “quite substantial”
// Tesco is stockpiling long-life goods in preparation for possible supply disruption at the end of the Brexit transition period
// Allan said if the UK and EU fail to agree on Brexit deal factors, tariffs are “almost inevitably are going to lead to higher prices”
Tesco chairman John Allan has reportedly said that the grocer is stockpiling long-life goods in preparation for possible supply disruption at the end of the Brexit transition period.
Allan was unable to rule out the chance of temporary shortages in some fresh foods from January but said this should only be for “a limited period”, Bloomberg reported.
Tesco has so far spread imports across UK ports to avoid a reliance on a few points of entry, including Dover, after several warnings of long freight delays.
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The Covid-19 pandemic has added to the strain at UK ports, with Southampton joining Felixstowe in operating beyond capacity.
To mitigate the expected supply disruption in the event of a no-deal Brexit, Allan said Tesco has been stockpiling products in its warehouses as well as diverting shipments to other UK ports besides Dover.
Moreover, Allan warned that tariffs on some food products are “quite substantial” and may encourage shoppers to buy more domestically sourced alternatives.
He said if the UK and EU fail to agree on Brexit deal factors, tariffs are “almost inevitably are going to lead to higher prices and I think if we go out on a no-deal basis that is unavoidable”.
Allan expects the price increase of the average shopping basket in the event of a no-deal Brexit to be between 3-5 per cent.
The news comes as supermarkets in Britain were reported to be given extra time to bring in new checks after the Brexit deadline, in an attempt to avoid disruption to the food supply chain in the new year.
Speaking in the House of Commons on Wednesday, minister Michael Gove said grocers will receive a three-month grace period from January 1 to help ensure food supplies between Britain and Northern Ireland are not disrupted by Brexit.
The extension will be in place regardless of whether the UK and EU agree a trade deal.