AILSA CHANG, HOST:
Prime Minister Boris Johnson pledged that the U.K. would prosper mightily by leaving the European Union.
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PRIME MINISTER BORIS JOHNSON: Brexit means Brexit, and we are going to make a titanic - a titanic success of it. So thank you.
CHANG: But for British food importers and exporters, Brexit so far feels like hitting an iceberg. Just three months in, it has raised their costs and threatened their businesses.
NPR's Frank Langfitt traveled through England and Wales for The Indicator, Planet Money's daily economics podcast, to see how Brexit is affecting oysters, wine and cheese.
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JONATHAN BAILEY: Going to get very, very wet. This isn't leaks (ph). This is just rainwater.
FRANK LANGFITT, BYLINE: It's just rainwater.
BAILEY: Yeah.
LANGFITT: It's a drizzling cold morning in Cornwall in southwest England, and I'm helping Jonathan Bailey bail out his rowboat. Jonathan's an oyster fishermen, but these days, his oyster boat mostly sits anchored offshore.
So since Brexit, how many times have you been out?
BAILEY: Not very many.
LANGFITT: That's because leaving the European Union has triggered environmental rules that make it much harder for British fishermen like Jonathan to sell oysters to Europe, which is pretty much his entire market, leaving him and more than 40 fishermen and women around here mostly out of work this season. I asked how this might affect them in the long run.
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BAILEY: I'm 66. I'm wondering whether this is the moment to say, the end.
LANGFITT: How would you feel about not fishing anymore?
BAILEY: I would be very, very, very, very upset.
LANGFITT: To understand just how Brexit is crushing oyster exports, I met Martin Laity, who owns Sailor's Creek Shellfish. He's been buying and exporting Jonathan's catch for three decades.
MARTIN LAITY: We sell our oysters - or did - to Brittany and to French merchants. They sell it under the Breton or Normandy flag.
LANGFITT: Before Brexit, when the U.K. was inside the European Union, Martin seamlessly shipped his oysters to Europe, where they were cleaned to remove the pollutants from the English waters. But now, because the U.K. is outside of the EU, British oysters have to be cleaned here before they go to Europe. Now, this doesn't sound like a big deal, but if you're in the oyster business, it is because it adds costs. And as soon as oysters are cleaned, Martin says there's just 48 hours to get them on the plates in Europe before they spoil.
LAITY: We'll be writing a lot credit notes for mortalities. This week we've got 10% mortality.
LANGFITT: Which means Martin loses hundreds of dollars per shipment in dead oysters. This and other changes because of Brexit have hurt the fish and shellfish business. British Treasury figures show the sector's exports to the EU fell by about 80% in January year on year.
LAITY: Our turnover's dropped 97%. I mean, we can't go on for eight months like this. We've laid off all our staff, our drivers.
LANGFITT: The government has blamed the steep fall in food and drink exports to the EU on pre-Brexit stockpiling, COVID restrictions and businesses adjusting to the new trade relationship. British officials say volumes are already rebounding, and Boris Johnson has called disruption in the fish trade teething problems and says the government will compensate businesses when it's not their fault.
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JOHNSON: But being no doubt there are great opportunities for fishermen across the whole of the U.K. to take advantage of the spectacular marine wealth of the United Kingdom.
LANGFITT: Brexit isn't just clobbering shellfish exporters like Martin. It's also created a mountain of paperwork for wine importers like Daniel Lambert.
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DANIEL LAMBERT: So this is our little warehouse.
LANGFITT: Daniel brings in tens of thousands of cases of European wine each year. In the good old days, which was just a few months ago, Daniel says importing was easy.
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LAMBERT: We used to just have to do one set of paperwork - very, very simple indeed.
LANGFITT: But now, because the U.K.'s outside the EU, there's a lot more.
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LAMBERT: I have to send the order to the producer. The producer then produces a pro forma invoice, which they send back to me. On the pro forma invoice...
LANGFITT: Daniel went on for more than a minute, describing the avalanche of confusing forms of rules. The cost of each new set of paperwork ranges from 38 to $90.
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LANGFITT: So on a scale of one to 10, how much are you enjoying this new system?
LAMBERT: (Laughter) About zero.
LANGFITT: Daniel says some small retailers won't be able to afford the new paperwork, so they'll order fewer varieties of wine. And some of these admin costs will be passed on to consumers.
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LAMBERT: The cost of a bottle of wine, I can see at the moment, you're talking nearly two bucks on a bottle.
LANGFITT: And they'll have less choice.
LAMBERT: Correct, but that's Brexit.
LANGFITT: When the U.K. voted to leave the EU in 2016, it meant walking away from an exclusive trading club, giving up free access to a market of more than 500 million consumers. Brexiteers told businesses at the time they'd still enjoy unfettered access to European markets, but David Henig, a London-based trade analyst, says the problems businesses now face were entirely predictable.
DAVID HENIG: This is normal in global trade that there are such checks and balances. What was abnormal was the U.K.'s previous relationship with the EU, the nature of that integrated market, and then the U.K. leaving it. The lesson from Brexit is, you can't have your cake and eat it.
LANGFITT: What U.K. business sectors are doing well from Brexit?
HENIG: There will be isolated winners in this, but in general, there will be more losers. We're seeing the stories of people struggling, not the stories of people managing to find new opportunities.
LANGFITT: But some savvy businessmen have found ways to turn Brexit problems to their advantage, at least for now. Simon Spurrell runs the Cheshire Cheese Company in northwest England. Here he is introducing me to his cows at milking time.
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SIMON SPURRELL: The cows have a very nice life. They're normally out wandering the 200 acres of fields around here, pastures to wander around all day. So it's lovely.
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LANGFITT: Simon used to export cheese to Europe smoothly and cheaply. But now, because of Brexit, he has to pay 250 bucks for a veterinary certificate for each order of cheese, which he says it's going to cost him $350,000 in lost sales this year. Simon shared his troubles on Twitter, and his countrymen came to his rescue. They started buying his cheese like never before. And in the first two months of this year, Simon's U.K. cheese sales went up 900%.
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SPURRELL: We've actually ended up with a surge of nationalistic cheese-buying frenzy there.
LANGFITT: How long do you think that'll last?
SPURRELL: I can't see this being a sustainable model. We can't keep shouting every single week, buy British, buy British.
LANGFITT: Back in Cornwall, Martin Laity, the seafood wholesaler, is adapting, too.
LAITY: We made some big adjustments to our business to sell more and more in the U.K. We started dreaming about ideas of having a local food market. We started thinking about selling more direct to the public.
UNIDENTIFIED PERSON: Have a nice one (ph).
LAITY: Thanks very much.
UNIDENTIFIED PERSON: That's all right.
LANGFITT: This is Martin's Saturday market. Right over here, he's selling scallops and mussels - next to it, some fish. We have pastries, fresh bread here, vegetables.
But no matter how much Martin sells at his new market, it can't come close to making up for what he's lost in Europe. Martin says three months in, Brexit is a cautionary tale.
LAITY: Let it be a lesson to every nation on the planet. This is a cockup beyond belief. And there's more to come. What we're going through now is just the beginning of the beginning.
LANGFITT: Frank Langfitt, NPR News, Cornwall, England.
(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.
