The post-Brexit collapse of Sterling has been of largely academic interest to the majority of the British public up till now.
However, Brexit got real for millions of shoppers Thursday, when the country’s biggest supermarket, Tesco, pulled hundreds of products manufactured by the multinational giant Unilever in a spat about price hikes.
Unilever said it was forced to raise prices following the Brexit-driven devaluation of the pound, which has seen the currency lose close to 20% of its value since the controversial summer referendum to leave the EU, which was won 52 to 48 per cent.
Tesco declined to pay the new prices, and said it would not stock Unilever products until the impasse was resolved.
Amongst the products to vanish from Tesco’s online inventory were the tangy yeast-based spread Marmite, PG Tips tea bags and Robertson’s lemon barley water, the long-time sponsor of the Wimbledon tennis Championships.
When the British voted to leave the European Union, it was scrounging immigrants, meddling Brussels bureaucrats and ‘politically correct’ EU legislation they thought they were doing away with, not Marmite.
Although several hundred products were affected, it was Marmite--a brown spread made from yeast extract, a byproduct of beer production--which caught the imagination of the British public.
This was unsurprising as the product is truly iconic, and known for sharply dividing opinion. Unilever famously ran ads for the spread which featured ‘haters’ chanting, “I hate / Mar-mite.”
Indeed, its whole advertising campaign was once driven by loving or hating it. Polarizing public figures are said to have ‘Marmite personalities.’
Memes parodying Cormac McCarthy’s The Road, in which a son asks his father what Marmite tasted like, popped up online, and even the usually sober Financial Times ran a humorous column from an imagined future, with a correspondent writing, “They will take my Marmite when they prize it from my cold, dead fingers.”
Conspiracy theorists were quick to accuse Unilever and Tesco–both of which campaigned for the UK to ‘remain’ in the EU--of manufacturing the Marmite crisis in a last ditch attempt to derail the Brexit process.
Theresa May, Britain’s Prime minister, has announced she intends to trigger Article 50, which begins the exit process, in March, and there is currently a furious row going on about whether that action should be subject to a parliamentary debate--which implies the possibility of parliamentary veto.
Others more simply accused Unilever of using the devaluation of sterling as a convenient cover to raise prices.
However, Unilever argued that a general rise in commodity prices and packaging materials combined with a near 20% drop in the value of sterling makes price rises inevitable.
As one financier told the Daily Beast, “This is just the beginning. If sterling drops 20%, and you import everything, as Britain basically does, then prices have to rise 20% to compensate.”
The smart money was always on Tesco to win the Marmite battle in the end, not least because Dave Lewis, chief executive of Tesco, worked at Unilever for 27 years before moving to the supermarket two years ago, and presumably knew exactly how much a pot of Marmite should wholesale for.
By the end of Thursday afternoon, the crisis was over.
Unilever issued a statement to the Daily Beast saying that that "the supply situation with Tesco in the UK and Ireland has now been successfully resolved" and that their "much-loved brands" were "once again fully available," adding, "For all those that missed us, thanks for all the love."
Details were not made public. However, it is thought that Unilever came off the loser in the tussle and backed down on the 10% demand, as Tesco put out their own statement saying, "We always put our customers first and are pleased it has been resolved to our satisfaction."
Happily at an end, the Marmite crisis did bring home in a very visible manner the fact that Brexit is likely to end up costing UK citizens significant extra percentages on everything from groceries to petrol.
And if Brexit does, despite the summer's 52-48 referendum result, get derailed, there will be whole new reason to love – or hate – the sticky brown spread.