The United Kingdom (UK) government recently announced the suspension of the tariff on the import of concentrated and ready-to-drink juices between Jan. 1, 2023, and Dec. 31, 2024. The decision should benefit juice shipments from Brazil to the United Kingdom.
Although the tariff suspension applies to juices from all origins, Brazil dominates global orange juice (OJ) exports. The Brazilian Association of Citrus Juice Exporters (CitrusBR) believes that without the UK’s 12.2% tariff rate, it will be possible for Brazil to save approximately $5 million in the two years of tariff exemption.
In 2019–20, 2020–21 and 2021–22, Brazilian shipments of OJ to the UK totaled on average 15,000 tons and generated $22.5 million per cycle, according to data from CitrusBR. Citrus BR represents Citrosuco, Cutrale and Louis Dreyfus Company, which lead world OJ exports.
In the first quarter of the current 2022–23 harvest, which ended in September, Brazil’s exports reached 276,200 tons and $520 million. The European Union (EU), the main destination for sales, was responsible for imports of 181,000 tons in the period, or $351.2 million.
Despite its small share of Brazil’s total exports, the UK is the third largest consumer market for OJ in Europe, after Germany and France. Hence the growth potential.
“We knew that there would be a window for reviewing a series of tariffs due to the UK leaving the EU and that there was a real chance that we could get this exemption, because there is no local orange juice production and it made no sense to penalize the consumer with a surcharge that only makes the product more expensive,” said the executive director of CitrusBR, Ibiapaba Netto.
CitrusBR led the negotiations for the tariff suspension, in partnership with the British Beverage Association and with the support of the Brazilian embassy in London.
Source: Valor Econômico
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