Icelandic fish plant pulls out of UK citing Brexit and Covid

A fish processing facility in Grimsby employing almost 200 workers is under threat of closure after its owner said Brexit and the coronavirus pandemic had made it too challenging to operate.

Iceland Seafood said the site at Grimsby, previously 10% of the group’s turnover, was no longer “a strategic fit” after buying the facility in 2018, and that it would focus on its other European facilities in Spain and Ireland for processing.

It said in a statement: “The investment and decision of the merger was completed in March 2020, just before Covid-19 started, and the renovation and installation of the factory was very much affected by Covid and later Brexit along with difficulties in overall operations.”

The fishing industry has for many years played only a marginal role in the overall UK economy, but still holds an important place in many coastal communities, which have seen unemployment rise as the sector declines.

During the Brexit referendum, some campaigners and MPs said leaving the EU could reinvigorate the industry in the UK, and several communities with a strong fishing heritage voted strongly to leave the EU. North-east Lincolnshire, which contains Grimsby, voted by 69.9% for Brexit, putting it 10th among the local authorities with the strongest leave votes.

Rows over British fishing rights nearly derailed the entire UK-EU trade deal in late 2020. However, the then prime minister, Boris Johnson, instead pushed through a deal that was decried as a “betrayal” by the National Federation of Fishermen’s Organisations, which had hoped to gain from the UK’s departure.

Bjarni Ármannsson, Iceland Seafood’s chief executive, said the company had been hit by a lack of cold storage as businesses stockpiled to prepare for possible disruption as the UK left the EU, as well as Covid-19 disruptions including shipping delays for its cod and pollock imported from China and Vietnam. “It’s always a combination of what was Brexit, what was the pandemic,” he said.

Ármannsson said extra paperwork following the UK’s departure from the EU had made importing fish more difficult.

“The processes around entering products into the country from south-east Asia, those became more cumbersome,” he said. “The UK market has become more difficult post-Brexit. The UK has become more cumbersome in terms of paperwork.”

The Grimsby facility, which was built by the prominent local businessman John Fenty, was taken over by Iceland Seafood UK in 2020 after it had shut with the loss of nearly 400 jobs. The company then reopened and merged it with operations from Bradford and Grimsby.

Iceland Seafoods, which employs about 1,000 workers across all of its operations, insisted that a sale to secure the future of the site was possible. It has hired Icelandic corporate finance firm MAR Advisors to find a buyer, and it has had some early-stage approaches.

The company said in a statement: “Although it has been concluded that the UK operation is not a strategic fit for Iceland Seafood anymore, the excellent facilities and strong management team in Grimsby can be a great addition to other companies in the sector.”

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