Boris Johnson will hold crisis talks with senior ministers and officials after France banned hauliers carrying freight across the channel amid fears over the new coronavirus strain.
Countries around the world have banned flights from the UK as an emergency response to the emergence of the mutant coronavirus, which spreads more easily than previous strains.
Ahead of a meeting of the Cobra committee chaired by the prime minister, transport secretary Grant Shapps said emergency measures were being put in place to cope with a backlog of lorries heading for the channel ports.
But he sought to play down the potential impact, stressing that container freight was not hit by the French ban on travellers.
The markets tumbled in response to the escalating coronavirus crisis and the looming prospect of a no-deal Brexit at the end of the transition period on 31 December.
More than £33 billion was wiped off the FTSE 100 within minutes of opening, as the index dropped more than 2%, although it later recovered to a fall of around 1.4%.
Along with France, countries across the world announced restrictions on UK travel following the disclosure that the highly infectious new strain is widespread across south-east England.
Italian authorities said the mutant strain had been detected in a traveller who recently returned to the country from the UK.
French health minister Olivier Veran said it was already “entirely possible” the new variant – VUI 202012/01 – was already circulating there, although tests had not detected it.
As well as affecting freight flows from Dover and the Channel Tunnel at Folkestone, the disruption will leave passengers stranded in the run-up to Christmas.
The chief executive of the Road Haulage Association (RHA), Richard Burnett, said the disruption could cause problems with “fresh food supply” in the run-up to Christmas.
He told BBC Radio 4’s Today programme: “With it being so close to Christmas we’re looking at 48 hours at this point in time in terms of the restrictions, we’re likely to see Operation Stack building in terms of numbers of vehicles on the UK side and that might be a deterrent for EU hauliers to want to come so close to Christmas and end up being stranded here, that’s part of the challenge that we’re facing today.”
Sainsbury’s warned there could be “gaps over the coming days” in the supply of lettuce, some salad leaves, cauliflowers, broccoli and citrus fruit – all of which are imported from the continent at this time of year.
Johnson is facing demands to recall parliament to address the crisis, which follows the introduction of a new Tier 4 level of lockdown on London and large parts of south-east England.
Concerns about the spread of the new variant also led to the dramatic scaling back of Christmas plans, with mixing banned in Tier 4 and the three-household provision being allowed for just Christmas Day itself in the rest of England.
Scotland’s first minister Nicola Sturgeon said it was “imperative” the UK Government sought an extension to the Brexit transition period, which protects current trading arrangements with the EU until the end of the year.
Among the authorities imposing travel restrictions on passengers from the UK are: France, Ireland, the Netherlands, Belgium, Italy, Austria, Bulgaria, the Czech Republic, Slovakia, Denmark, El Salvador, Turkey, Canada and Hong Kong.
They reacted after Johnson announced that the new variant was up to 70% more transmissible than the original strain while health secretary Matt Hancock admitted it was “out of control” and the Tier 4 lockdown may have to remain in place for months.
Concerns about the rapid spread of the disease were underlined with the publication of the latest official figures showing there had been a further 35,928 lab-confirmed cases of coronavirus in the UK as of 9am on Sunday.
And at an emergency meeting late on Sunday night, the Northern Ireland Executive agreed to reduce the five-day Christmas bubbling arrangements to just one day, following the rest of the UK.
Ministers also debated a temporary ban on travel from England to Northern Ireland because of the new Covid variant, with further discussions expected on Monday.
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