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Even if the government strikes a trade deal with the EU, impacts on the supply chain, such as non-tariff trade barriers and labour shortages, could lead to spiralling costs for dairy companies, a report by the London School of Economics (LSE) found.
The report, commissioned by Arla, said longer waiting times for customs inspections at the border would increase trading costs because of longer hours for lorry drivers.
Every seven minutes of port check times would add 10 hours to transportation times, it found, equating to at least £111 ($144.81) extra per container. However, other factors like fuel and lorry maintenance costs, loss of perishable good life and higher wages for lorry drivers mean the figure is “at the lower end of the likely range.”
The report warned of extra delays because the U.K. Customs Declarations Service would have to deal with 250m declarations per year after Brexit, 100m more than the 150m it was designed to handle, which could further compound the £111 figure.
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