The Food and Drink Federation said the new trading arrangement with Europe had cost exporters more than £1.1bn since January, when Britain left the customs union and single market.
Milk and cream exports collapsed by 96.4 per cent while cheese sales to the EU fell by 64.6 per cent in the year to February.
Figures published by the Agriculture and Horticulture Development Board, citing HMRC data, also showed that in February 2020, just under 76,500 tonnes of milk and 901 tonnes of bulk cream were exported to Europe – compared to just 131 and 436 tonnes of milk and cream sent respectively in February 2021.
Buttermilk and yoghurt exports were also down 91 per cent, comparing February 2021 with the same month a year earlier, while butter exports plummeted by 89 per cent, milk powder was down 86 per cent, whey fell 83 per cent and cheese dropped 75 per cent.
Experts have blamed extra paperwork and delays which particularly impact fresh products with a short shelf life.
Extra costs, and the necessity for additional preparation to be made before items are packaged and shipped, are also said to be turning European importers off British products. These hurdles are said to be affecting smaller businesses disproportionality.
The industry has warned that the resulting collapse of “groupage” movements – where goods from different companies that are being shipped to different locations are grouped on one lorry – is compounding the problem, especially for small and medium-sized businesses.
For example, The Cheshire Cheese company said earlier this year it could no longer sell barrels of cheese directly to consumers in the EU because of Brexit red tape – forcing it to consider setting up in France.
The company sold £180,000 worth of truckles, the traditional name for cheese shaped like a barrel, to countries across Europe last year.
However, managing director Simon Spurrell said that was no longer possible because of the huge additional costs now involved in shipments.
The company found that sending specialist cheeses worth around £25 to EU customers requires a health certificate, signed off by a vet, that costs £180 pounds per consignment.
Dominic Goudie, the FDF’s head of international trade, said: “UK businesses continue to struggle with inconsistent and incorrect demands at EU borders, and small businesses have been hardest hit due to the collapse of groupage distribution into the EU.
“New EU import requirements for composite products entered into force this week, adding even greater complexity, cost and uncertainty for UK exporters.”
One headache for UK exporters now that they are outside the bloc is the EU Rules of Origin legislation, which puts a limit on how much of a third country’s ingredients - for example those of the UK - can be used when producing goods in the EU.
“Trade with the EU is well below normal levels across all sectors and dairy is no exception,” said AHDB analyst Charlie Reeve.
“Volumes of UK dairy exports to the EU during February were marginally higher across most products than in January. Despite this small month-on-month increase, they remain notably lower than volumes exported this time last year.”
The government has previously blamed a “unique combination of factors, including stockpiling last year, Covid-19 lockdowns across Europe, and businesses adjusting to our new trading relationship”.
The Independent asked Defra to explain the drop in exports but did not hear back at the time of publication.
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