Under pressure
Attending the FDF Conference today you get more of a sense of how the world is uniting against Russia’s brutal invasion of Ukraine. Yet, continuing supply chain disruptions, clogged ports, logistics strains and strong demand for merchandise only serve to illustrate the points made by Karen Betts, chief executive of the Food and Drink Federation.
Food and drink companies are only too aware of the implications that sanctions, trade restrictions and the supply chain disruption will cost UK businesses and shoppers. This will undoubtedly translate into food price rises and, possibly, temporary shortages.
With Ukraine and Russia — for different reasons — no longer exporting goods to most nations, we can only expect some degree of global shortages that exacerbate existing inflation.
The UK will likely suffer the impact from the price rises caused by shortages in world markets. The FDF outlined the folowing: this month, global wheat prices spiked at more than 80 per cent higher than a year ago. Sunflower oil — 80 per cent of it produced by Ukraine and Russia — is rapidly becoming unavailable, pushing up the cost of alternatives. Other products, such as white fish and the wood pulp used in packaging and labels, are becoming scarce as supplies from Russia and Ukraine dry up.
The last few years have been challenging, however we overcame. But this year’s inexorable rise of input costs — ingredients, raw materials, energy and so on — means limits will be pushed (again!).
There is very little companies can do. To echo the FDF, the government will have to step up and mitigate food price inflation in the UK and eliminate gaps on shelves.
Most importantly, what’s needed is a National Food Security Council, to work alongside the industry and enable the sector to respond collectively, and fast, to the impact of supply chain disruptions. Some effects are already clear but others will take longer to understand. Industry doesn’t ask for much but it needs to react to immediate issues of ingredient and energy costs and the longer-term impacts of fertiliser, petrochemical and carbon dioxide shortages.
The establishment of an overarching, co-ordinated council is an absolute requirement to deal effectively with the internal food insecurity realities and meet global undertakings.
It’s never too late – urgent interim arrangements are possible. Hopefully, the legal framework and related administrative processes to establish a Council as a very high priority do exist for approval of its terms of reference, functions, responsibilities, and composition.
- Rodney Jack, editor, Food & Drink Technology.
Keep in touch via email: [email protected] Twitter: @foodanddrinktec or LinkedIn: Food & Drink Technology magazine.
