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In Sign of ‘Brexit’ Impact, Marmite Could Disappear From Stores Marmite Survival After a ‘Brexit’ Scare Comes With a Price
(about 7 hours later)
LONDON — Months after Britain voted to leave the European Union, the first tangible victim of that decision appears to have emerged and, like the 28-nation bloc itself, it has divided the country for years: Marmite, a sludgy and odd-tasting breakfast spread. LONDON — Months after Britain voted to leave the European Union, the first tangible victim of that decision has emerged and, like the 28-nation bloc itself, it is something that has divided the country for years: Marmite, a sludgy and odd-tasting breakfast spread.
In the months since the June referendum, many who voted for withdrawal from the European Union, a process known as Brexit, have brushed off concerns of a possible recession or that car manufacturers and banks based in the country might leave. They have even celebrated the pound’s recent fall to a 31-year low, arguing that a weaker currency is good for exporters. Since the June referendum, many who voted for withdrawal from the European Union, a process known as Brexit, have brushed off concerns that a recession was possible or that car manufacturers and banks based in the country might leave. They have even celebrated the pound’s recent fall to a 31-year low, arguing that a weaker currency is good for exporters.
But they probably never thought it would come to this.But they probably never thought it would come to this.
Fears that Marmite and other British classics, like the PG Tips brand of tea bags, might disappear from store shelves gripped Britain on Thursday, after reports that the supermarket chain Tesco and the owner of those brands, the British-Dutch consumer goods company Unilever, were locked in a price dispute over who should bear the cost of the weakening pound. Fears that Marmite and other British classics, like the PG Tips brand of tea, might disappear from store shelves had gripped Britons after reports that the supermarket chain Tesco and the owner of those brands, the British-Dutch consumer goods company Unilever, were locked in a price dispute over who should bear the cost of the weakening pound. Marmite was briefly unavailable in Tesco’s online market, and store supplies dwindled.
The pound has fallen drastically against other major currencies since the vote to leave the bloc, and amid increasing worries that Britain would opt for a “hard Brexit,” shorthand for a strict break with the European Union, which could limit its tariff-free access to the region’s single market for goods and services. The pound has fallen drastically against other major currencies since the vote to leave the bloc, and as worries have increased that Britain would opt for a “hard Brexit” — shorthand for a strict break with the European Union — which could limit its tariff-free access to the region’s single market for goods and services.
But after the markets closed on Thursday, Tesco reassured the public that the crisis had been averted. In a statement, Tesco said, “We’re pleased this situation has been resolved to our satisfaction.”
In reality, consumers will most likely have to dig deeper into their pocketbooks. Graeme Pitkethly, Unilever’s chief financial officer, said during an earnings call on Thursday that “prices should start to increase to cover the cost of imported goods due to weaker sterling.”
Still, the concerns over the beloved consumer goods led to a political uproar.
“Who would have thought that the first casualty of a hard Brexit would be the nation’s supplies of Marmite?” asked Pete Wishart, a member of Parliament for the Scottish National Party, which campaigned to remain in the European Union.“Who would have thought that the first casualty of a hard Brexit would be the nation’s supplies of Marmite?” asked Pete Wishart, a member of Parliament for the Scottish National Party, which campaigned to remain in the European Union.
On Twitter, Britons wryly noted that store shelves were emptied of Marmite jars, and one used jar was put up for sale on eBay for 100,000 pounds, or about $122,000. News bulletins on the BBC led with the possible Marmite shortage.On Twitter, Britons wryly noted that store shelves were emptied of Marmite jars, and one used jar was put up for sale on eBay for 100,000 pounds, or about $122,000. News bulletins on the BBC led with the possible Marmite shortage.
“This is a concrete case of Brexit affecting people’s lives,” said Pinar Hosafci, a senior food analyst at Euromonitor International. “Talk of Brexit had been more political, financial and a bit abstract” before, she added. “This touches their lives.”“This is a concrete case of Brexit affecting people’s lives,” said Pinar Hosafci, a senior food analyst at Euromonitor International. “Talk of Brexit had been more political, financial and a bit abstract” before, she added. “This touches their lives.”
A Tesco spokesman declined to comment but did not dispute reports in the British news media about the two companies’ wrangling over prices, resulting in the supermarket chain removing popular Unilever products from its website. Among the affected brands is Colman’s Mustard, which, like Marmite, is produced in Britain.
Among the affected brands is Colman’s Mustard, which, like Marmite, is produced in Britain. Household goods imported from the Netherlands, like Dove soap, were also unavailable online. (Stores still stock them.) Analysts noted that although Marmite and some of the other affected brands were made in Britain, Unilever published its company results in euros, meaning that those products were still affected by a weaker pound. Imported household goods like Dove soap and Ben & Jerry’s ice cream are also under the Unilever umbrella.
A spokeswoman for Unilever declined to comment. Analysts noted, however, that though Marmite and some of the other affected brands were made in Britain, Unilever publishes its company results in euros, meaning that those products are still affected by a weaker pound.
It remains unclear whether the dispute was directly linked to the weakening of the British currency, or whether the two companies were trying to gain leverage in price negotiations.
In 2011, Tesco refused to stock Branston Pickle after another supplier, Premier Foods, tried to pass on cost increases.In 2011, Tesco refused to stock Branston Pickle after another supplier, Premier Foods, tried to pass on cost increases.
Whatever the underlying reason, analysts predicted that food prices would start to rise in the coming months as supermarkets struggle to absorb the extra cost of imported goods, which are more expensive when a currency weakens. Analysts have predicted that food prices will start to rise across the board in the coming months as supermarkets struggle to absorb the extra cost of imported goods, which are more expensive when a currency weakens.
Stores have already stopped promotions and discounts on their products, Ms. Hosafci said. But “price increases will start happening in the next four to five months, when they will need to renew their stocks.”Stores have already stopped promotions and discounts on their products, Ms. Hosafci said. But “price increases will start happening in the next four to five months, when they will need to renew their stocks.”
“Eventually, they’ll need to increase prices,” she added. “Otherwise, their businesses will no longer be profitable.”“Eventually, they’ll need to increase prices,” she added. “Otherwise, their businesses will no longer be profitable.”