Supply chain crisis 'will lead to higher food prices'

14 October 2021

Rising labour, transport and energy costs have left the UK’s food chains in disarray which could lead to double-digit inflation, a major chicken producer has warned.

Ranjit Singh Boparan, owner of Bernard Matthews and 2 Sisters Food Group, which produce around a third of all poultry products eaten in the UK, said: “The days when you could feed a family of four with a £3 chicken are coming to an end.”

He said even government intervention would not be enough to prevent price rises caused by the UK supply chain crisis.

“Three months ago I was vocal about the government needing to help with labour issues. I’ve now come to the conclusion that in reality it can’t fix all the problems, nor can it control inflation,” he said. 

“The temporary seasonal visas for poultry workers is welcomed, so is the government’s willingness to look at supply chains, but we need to be honest about the long-term implications.

“Less labour means less choice, core ranges, empty shelves and wage inflation, and this isn’t going to change. We need to work with our supply chains and customers to solve these issues, but it will come at a cost.” 

Boparan said the company’s energy costs had risen 450%-550% year-on-year across its 600 farms and 16 factories.

The Association of Independent Meat Suppliers has estimated the industry has a shortage of around 15,000 workers.

Boparan said wages across his companies had risen by 15% and fuel costs were at their highest since 2013.

He said: “Food is too cheap, there’s no point avoiding the issue. In relative terms, a chicken today is cheaper to buy than it was 20 years ago. How can it be right that a whole chicken costs less than a pint of beer? You’re looking at a different world from now on where the shopper pays more.

“Inflation is decaying the food sector’s supply chain infrastructure and its ability to operate as normal. That’s from farm to your plate. There’s hundreds of farmers out there struggling, and they need our support just as much as anyone. 

“We really have to start thinking differently about what our food priorities are and what they cost.” 

Chancellor Rishi Sunak told the BBC the government is doing "absolutely everything we can" to fix supply chain issues in the UK. 

Ships have been turned away from the UK’s busiest port in Felixstowe due to bottlenecks caused by the shortage of HGV drivers.

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