Chip shops are facing soaring costs for oils, fish and potatoes © Chiaki Nozu/FilmMagic
Chip shops are facing soaring costs for oils, fish and potatoes © Chiaki Nozu/FilmMagic

Third of chip shops at risk due to cooking oil crisis

27 April 2022

Rocketing cooking oil costs could see 3,000 fish and chip shops close, a trade body has warned.  

Sunflower oil has risen by 47% in a matter of weeks, while soaring energy and fish costs have created a “perfect storm”, Andrew Crook, president of The National Federation of Fish Friers, told Supply Management.

The price of sunflower oil rose from £30 for a 20-litre drum of oil at the beginning of April to £44 last week, leaving fish and chip shops “struggling” to operate.

Crook said: “It really is the perfect storm, and I think businesses are definitely in trouble.”

He said palm oil had risen from £14 to £29 for 20 litres, and he expects it to rise “beyond £30 or £40 pounds in the next weeks”. 

“With the conflict in Ukraine, because a lot of sunflower oil comes from the country, not only forcing the price up for sunflower, but palm oil too because everyone's trying to buy as much as they can.”

He said Indonesia's announcement of a ban on palm oil exports was “worrying”, as the industry gets around a fifth of its palm oil from the country.

“We're just feeling the start of pressure,” he said. 

On top of rising cooking oil costs, chip shop staples including fish and beef dripping have gone up in price.

The price of beef dripping has doubled from £20 for 20 kilos to £41, while fish is “the most expensive it’s ever been”. He said fish and chip shops were exploring cheaper alternatives to the traditional cod and haddock including hake, and said consumers looking to get cod and haddock would have to pay a premium. 

Crook said he had been forced to raise the price of fish and chips in his shop – Skippers Fish & Chips in Euxton, Lancashire – from £7 to £8, but he warned prices could rise again to £8.50. However, he said fish and chip shops were having to absorb some of the cost increases. 

The industry could face further problems with potato supplies. He said: “The big fear is the weather at the moment. We're heading towards a drought, just as the potatoes are growing. If we don't get rain and they don't grow that could be a big worry as well. So we're just going to roll with the punches.

“It's definitely going to be tough. My business is going to struggle to get through because consumers seem to just want to go on price. Sometimes it hurts when somebody says, 'Why are you so expensive?' It makes me think, 'Do you want me to work for free?'”

“I've been in business 22 years so you kind of get a thick skin, but if you don't you want to cry.”

Martin McTague, national chair of the Federation of Small Businesses (FSB), told SM: “An increase in the cost of cooking oil, and a decrease in its availability, is bad news for small restaurants and cafes, especially ones which use a lot of oil, like fish and chip shops.

“Switching suppliers is unlikely to help, as the issue is widespread, while switching to a substitute product may not be possible, due to price, different performance of the oil at high temperatures, or other concerns.”

The FSB’s Small Business Index research for the first quarter of 2022 found nine in 10 businesses in the accommodation and food service sector had experienced increased costs over the past three months, with four in 10 reporting a significant increase. 

Karen Betts, chief executive at the Food and Drink Federation, told SM: “Supply chains, already disrupted by Covid-19, have been further complicated by the war in Ukraine, which is causing shortages in some ingredients like sunflower oil and raising the price of substitute ingredients.  

“Manufacturers are doing all they can to keep costs down but inevitably some will have to be passed to consumers. With manufacturers under real pressure, the government must act to ensure that upcoming regulation is absolutely necessary and does not force new costs onto businesses, which in turn risks raising prices for shoppers.”

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London (Central), London (Greater)
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Insight Executive Group
London (Central), London (Greater)
Circa £60K
Insight Executive Group
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