The legacy of the wettest summer on record = rising prices in the UK food market

October 18, 2012
3 min read

The UK experienced the wettest summer (defined as June, July and August) in a century in 2012 and the second wettest since records began, with only 1912 faring worse, according to the Met Office.

Across the pond, the US saw the worst drought in over 50 years after temperatures topped 100 °F plus, while Russia too experienced a heatwave.

The result = rising food prices in the UK market

The effects of the weather abroad have already driven up food prices as grain costs have risen, according to the British Retail Consortium, while the wet weather at home has resulted in poor harvests.

Peter Kendall, President of The National Farmers Union, has warned that increases in the global cost of wheat are putting pressure on farmers who buy grain to feed their livestock, which in turn puts strain on the prices they charge retailers for pigs and poultry.

Indeed, the National Pig Association has already predicted a global pork shortage and price rises for 2013, threatening its affordable positioning, although this should help the market to achieve a more sustainable added-value future.

Similarly, the adverse weather has resulted in smaller crops of many root vegetables and fruit in addition to smaller and less sweet fruit when compared to previous years.

What does this mean for British consumers?

Retailers are reportedly working to protect consumers from the full impact of rising prices and rightly so – more than eight in ten consumers are ‘increasingly concerned that prices are going to continue to rise’ (See our ‘Pricing and Promotions in Food and Drink‘ report) while almost as many say that they would ‘stop buying some products altogether if they become too expensive’. The passing on of such rises does seem inevitable, however, likely causing consumers to reassess their spending habits.

What the farming industry has been keen to stress is that weather patterns and the yield from crops are cyclical. This volatility means that the supply chain has to be even more flexible and reactionary.

The recent relaxation of the rules on ‘ugly’ or ‘wonky’ fruit by retailers such as Sainsbury’s, in the wake of 2012’s bad weather, has been met by calls by campaigners such as Friends of the Earth for a permanent change in the future.

As evidenced in Mintel’s Hungry Planet Inspire trend, the global population is predicted to reach 9 billion by 2050. The world is changing, with increasing demand for food putting further strain on a limited supply. The Earthwatch Institute argues that if everyone in China lived like the average American, they would consume 80% of the world’s meat production.

Global food supply is a growing issue and one that consumers, retailers and farmers need to continue to prepare for and react to.

Amy Price
Amy Price

Amy Price, a Mintel Food & Drink Analyst produces and writes reports, providing insight and analysis on the food and drink market and regularly contributing in the media.

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