Ukraine invasion could impact UK food and drink prices

Russia's invasion of Ukraine could impact food and drink prices in the UK, with the two countries making up approximately a quarter of the world's grain exports.

In its latest market report, catering butchers Birtwistles said feed costs were expected to increase substantially with "serious concerns" over the impact on milk and meat production in the UK, and increases already visible in EU-supplied poultry.

Dulcie Neal, buyer at craft beer retailer HonestBrew, warned the beer industry should also be prepared for further price increases or severe supply chain problems.

Svein Tore Holsether, chief executive of Norwegian chemical company Yara International, which produces nitrogen fertiliser used for food production worldwide, said that the most extreme calculations indicated that if Ukrainian farmers were unable to add fertiliser to the soil this season, crops could be reduced by 50% by the next harvest.

In addition, 40% of Europe's natural gas supply, which is important to produce nitrogen, is coming from Russia, as well as 25% of Europe's supply of nitrogen, phosphate and potash.

"The biggest sources of raw material to Europe's food production are being subject to limitations, and there are no short-term alternatives," warned Holsether.

Steep price increases in oil and gas, already threatening the viability of many business models, have also been exacerbated by Russia's invasion of Ukraine, with hospitality operators reporting energy price hikes exceeding 200% and some energy providers refusing to even issue quotes to businesses.

Operators are being invited to add a voluntary donation to their bills this month to support the #CookForUkraine initiative.

Photo: Ryzhkov Oleksandr / Shutterstock