Brexit Impact on Germain, G&h, SG?

[oldgeezersmoker]

I first started wondering about this with regard to Germain, as my understanding is that the Jersey Isles have a different legal standing with the UK than its constituent parts. (I may not have stated that elegantly, but I hope UK forum members will bail me out.). But I suppose the implications of Brexit might also apply to G&H/SG, though perhaps in a different way. Since these makers rely on imported leaf, my first guess would be that a "hard" or "no deal"Brexit could have a huge negative impact if some of the things I read about trade disruption and tarrifs, etc.are true, but I certainly don't know.
Anybody from the UK thinking about this?

 

[64alex]

I am not from the UK and provided I don't think there will be a hard Brexit but a last minute agreement will be found, even in the case of a hard Brexit I don't think it will affect them that much as their leaf imports is from outside the EU, mainly India, Africa and South America which are not affected from Brexit.

 

[oldgeezersmoker]

Tarriff rates are presently set by the EU. Would they revert to whatever the rates were pre the UK joining the EU? Were those higher or lower? And what about the Jersey Islands? My understanding based on a conversation from many years ago with a Dunhill executive was that Germain was able to import leaf from the US at a lower tarrif rate than Dunhill (really Murray's, but they were under common ownership) was charged. This was about the same time that the UK joined the EU and he thought that would change. Whether or not it did I do not know.
These companies also export to the EU. Could they be priced/kept out of that market?

 

[warren]

There are a lot of opinions and scenarios but, the reality is ... no one knows. Each side will react to the reality when/if the exit occurs.

 

[sablebrush52]

I would be very surprised if anything much changed immediately. They have stocks of components that represent several years worth of production. Flavorings might be another issue. In the meantime they will be sorting it out. So, no predictions except that anything they brought to the US market after February 15th 2007 will be disappearing by August 8th 2021.

 

[cosmicfolklore]

I predict calm, easy transitions, and shrieking, hair-pulling madness. Babies burning in the street, and dogs that want back inside, but their owners are too lazy or deaf to hear them scratching at the door. ::

 

[greenmtnsmoke]

Wouldn't the US have to negotiate a trade deal with the UK because the current agreement is between the US and EU? Can you imagine the price of Esoterica and Sam Gawith on ebay if there is a stoppage of imports to the US from the UK? Could this be why we just experienced a massive 6 month dump of Esoterica blends that seems to have come to a halt?

 

[oldgeezersmoker]

@greenmtnsmoke, I think in the longer run the parade of horribles you mention might come to pass, but right now I don't see it. Kretek just announced that they are taking over distribution of G&H from Arango. They already distribute SG through their Phillips and King subsidiary. So they seem to think there will be more to come. And it does look like, as of this morning, that Brexit, hard, soft, or no deal, might be delayed at least a few months.

 

[smudgersmissingleg]

If we leave without a deal the UK will trade under WTO rules which apply different tariffs for different products which I believe can be quite high for agricultural products iirc dairy was about 30% for example.

I remember reading that an option was we could lower or even remove tariffs but I think if we do that we would have to do the same for each country and cannot pick and choose. Still if we do 'crash out' of the EU I would be surprised if we didn't at least lower tariffs as we would want/need to kick start trade with our partners.

I don't know what the tariffs on tobacco products would be under WTO or if we would lower or even remove them completely but as I said before I would be very surprised if we didn't as getting trade going will surely be top of the list whoever is in power. This is of course if we leave without a deal with the EU which is possible but there's still a long way to go yet and EU negotiations are known for going right to the wire so I wouldn't worry just yet.

Chris.

 

[greenmtnsmoke]

I hope you both are correct and I appreciate the positive thinking.