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Triple threat: How Brexit, bad weather and coronavirus will affect food prices

17 March 2020 by
Triple threat: How Brexit, bad weather and coronavirus will affect food prices

Brexit, inclement weather and the coronavirus outbreak are all going to have an effect on the supply chain. Buying specialist Lynx Purchasing has the lowdown

Bad luck travels in threes, so it’s said, and buying specialist Lynx Purchasing is warning that the hospitality supply chain is threatened by a triple whammy of challenges in the form of tighter immigration controls, the aftermath of the storms and the coronavirus outbreak.

“Any one of these things would have the potential to cause serious disruption in terms of both price and availability,” says Rachel Dobson, managing director of Lynx Purchasing. “Taken together, it would be very wise for hospitality businesses to have plans in place for the next few months in terms of menu flexibility.”

The advice comes as Lynx Purchasing publishes the spring 2020 edition of its regular Market Forecast, which offers operators an in-depth look at pricing and product trends over the coming months, using exclusive data gathered from the range of suppliers that work with Lynx Purchasing.

Immigration controls

With the UK having formally left the EU at the end of January, “the new points-based rules announced from the start of 2021 will affect many of our customers directly in terms of their workforce. It will also have an effect throughout the supply chain, where migrant labour is currently relied on for picking, production, packing and other essential tasks.”

Weather

A series of storms has left many parts of the UK flooded or waterlogged, and this will inevitably have an impact on both availability and quality of a whole range of crops, as well as livestock production.

“Many producers won’t know the full extent of damage to their crops until the time comes to harvest,” says Dobson. “So while it will take some time for the full impact to become clear, some problems are inevitable.”

Coronavirus

This is a quickly changing situation, but measures to prevent the spread of coronavirus, both within the UK and globally, are likely to significantly affect the supply chain. Curbs on movement affect commercial as well as personal travel, and successful controls will inevitably have an impact on availability.

Dobson adds: “Consumer confidence is the big unknown. As always, though, the best advice is to keep talking to suppliers, keep menus and dish descriptions flexible, and be ready to change where needed.”

Meat

The very wet weather caused problems during the UK lambing season, which has already been experiencing shortages and price increases, and availability will be later than usual.

Following the African swine flu outbreak and subsequent fall in global pork production, the Chinese are buying more lamb and beef instead of pork, creating price pressure and potential shortages in the UK market. Pork prices continue to hold firm after the significant fall in global production.

Fish and seafood

The biggest unknown is the ongoing effect of coronavirus on the supply chain for fish and seafood. The economic downturn in China led to cancelled orders and a log jam of imported seafood into the Chinese ports, which in turn has depressed seafood prices across the globe.

In the UK, the extreme weather in January and February triggered increases in the price of wild caught fish, shellfish and some farmed fish.

However, the coronavirus effect is now resulting in an unexpected price drop due to falling demand for exports. So potentially spring could see a good supply of wild and farmed seafood, lobster, crab and scallops, with prices stable or reduced. However, any changes in global demand, as well as the impact of the weather on UK fisheries, means the picture may change.

Produce

The potato crop is almost certain to have been affected by the very wet weather, which could lead to problems with the availability and quality of larger varieties, such as baking potatoes, later in the spring and early summer.

UK yields of onions are also down, and UK leaf salads will be later this spring due to delays in planting caused by the bad weather. Beyond the UK, there are concerns about the availability and price of button mushrooms due to labour shortages in Eastern Europe.

Dobson adds: “We’ll be working closely with the suppliers we partner with to keep our customers up to date with developments across the supply chain.

“For many businesses, Easter is the start of the peak trading season, and it will be important to ensure that menus are both appealing and profitable.

“Using descriptions such as ‘catch of the day’ for fish and seafood, and ‘served with fresh, seasonal veg’, can help operators to make the most of produce when it’s at its best in terms of price, quality, and availability.

Sourcing as close to home as possible has sustainability benefits as well as appealing to customers who want to support British producers.

“However, we all trade in a global supply chain, and it looks like some disruption is inevitable. Operators who plan ahead will be the best position to trade through it.

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