The UK Government’s Business, Energy and Industrial Strategy committee has warned that failure to secure a free trade agreement with the EU after Brexit would have a ‘seismic impact’ on the nation’s food and drink sector.

The food manufacturing industry, valued at £28.8bn, is the UK’s largest manufacturing sector and employs 400,000 people.

In the committee report titled ‘The impact of Brexit on the processed food and drink sector’, committee chair Rachel Reeves wrote: “The success of the industry has been highly dependent on participating in the [EU] single market and customs union.

“To ensure the continued success of our food and drinks industry, the government must provide clarity and certainty on our future relationship with the EU and seek continued regulatory, standards, and trading alignment with the EU in the processed food and drink sector.”

The committee expects exports of processed food items such as chocolate, cheese, beef and pork to suffer after the EU withdrawal transition period ends in December 2020. The problem is compounded for UK consumers who will see less choice of food products, as well as paying higher prices.

The report stated that using the World Trade Organisation’s (WTO) tariffs alone would “seriously jeopardise the competitiveness of UK exports”, adding:  “The government should also seek to replicate all existing EU trade deals with third countries, as they constitute our biggest export destinations.”

It also called on the government to ensure that the supply of EU workers to the food and drink industry would be safeguarded.

Food and Drink Federation chief executive Ian Wright said the report was ‘extremely valuable’ to the future of the UK’s trading relationship with Europe.

“We echo the committee’s call to government for increased customs capacity and support for businesses of all sizes to navigate the changes ahead. The proposed transition length is briefer than we believe would be optimum and government must review how ‘readiness’ is progressing,” Wright said.

“FDF supports government in its efforts to find the right technology to avoid a hard border and any customs or phytosanitary checks. However, time is running out when it comes to finding a credible, technological solution and the option of a regulatory backstop must be left on the table.”