UK suspends tariff on juice imports

The British government announced last week that the tariff on concentrated and ready-to-drink juice imports will be suspended from January 1, 2023, and December 31, 2024. The decision should benefit Brazilian orange juice shipments to the United Kingdom.

Although this decision is valid for juices from all origins, Brazil dominates global orange juice exports. The National Association of Citrus Juice Exporters (CitrusBR) believes that without the 12.2% tariff, Brazil will be able to maintain sales levels similar to the previous three harvest seasons and save approximately USD 5 million over the two years that the tax will be suspended.

In 2019/20, 2020/21, and 2021/22, Brazilian shipments of orange juice to the United Kingdom averaged 15 thousand tonnes, generating US$ 22.5 million per season, according to data from CitrusBR, which represents Citrosuco, Cutrale, and Louis Dreyfus Company, the world leaders in the sector.

In the first quarter of the current 2022/23 market year, which ended in September, the country’s exports reached 276.2 thousand tonnes, the equivalent of US$ 520 million. The European Union, Brazil’s largest importer, purchased 181 thousand tonnes in the quarter, or US$ 351.2 million.

Despite the small share in total exports from Brazil, the United Kingdom is the third main consumer market for orange juice in Europe, after Germany and France. As a result, the growth potential is high, even though the Brazilian offer for the 2022/23 harvest is limited due to recent climate issues.

“We knew that Brexit would present us with opportunities to review many tariffs and that there was a real chance of Brazil being exempt from this tax since there is no local orange juice production in the UK, and it makes no sense to penalize consumers with a surcharge that only makes the product more expensive,” writes Ibiapaba Netto, executive director of CitrusBR, in a note.

On the same note, Tatiana Campos, director of institutional relations at CitrusBR – who led the negotiations that culminated in the tariff suspension in partnership with the British Beverage Association and with the support of the Brazilian embassy in London -says that issues related to the sustainability of the production also weighed in on the decision.

According to her, among other things, preservation areas with links to orange orchards and pollinator management were used as arguments in favor of the exemption request.

Source: Valor Econômico

To read the full original article, please go to: https://valor.globo.com/agronegocios/noticia/2022/11/23/reino-unido-suspende-tarifa-incidente-sobre-as-importacoes-de-suco.ghtml

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