Open markets are critical for food security during pandemic, UK industry underscores

17 Apr 2020 --- Supply chain pressures brought on by the ongoing COVID-19 pandemic have been flagged alongside concerns of growing protectionism in Europe’s agri-food sector by UK F&B stakeholders. The industry bodies are collectively urging world governments to ensure that import and exports markets are kept open during COVID-19. They stress that the local industry cannot operate in isolation during this critical time.

“The continuation of trading through open markets is absolutely vital to help aid the global economic recovery and protect the economies of many supplying countries. We have seen some countries introduce trade restrictions that may have the unfortunate consequence of impeding the flow of goods between nations,” stress the British food sector stakeholders.

While they concede that some nations may place temporary selective restrictions on exports where there is a direct threat posed to the ability of their communities to access affordable food and drink, they note it is “incumbent on the UK and other developed nations to lead the way and reject moves toward protectionism.”

French President Emmanuel Macron echoes that a protectionist agenda, saying, “We will have to rebuild our economy stronger in order to produce and give full hope to our employees, our entrepreneurs, to keep our financial independence. We will have to rebuild French agricultural, health, industrial and technological independence and ensure more strategic autonomy for Europe.”

The British F&B stakeholders explain the critical need for keeping markets open, noting that local farmers rely heavily on imported feed and need access to other markets to sell their products, especially where demand in the UK is insufficient. Ensuring the free movement of products
As previously reported on FoodIngredientsFirst, pandemic concerns contributed significantly to a World Food Price dip in February. UK food and drink exports more than £23 billion (US$28.6 billion) of products each year, according to FDF statistics. “These exports are essential to ensuring UK businesses have access to working capital that means production for the UK market is viable. They provide an outlet for British products all over the world,” outlines FDF. 

“They allow movements of ingredients and raw materials to nearby neighboring countries for further processing that cannot be performed in the UK, with the goods returning to the UK where they will end up on shop shelves and in our restaurants,” it continues.

The British F&B stakeholders explain the critical need for keeping markets open, noting that local farmers rely heavily on imported feed and need access to other markets to sell their products, especially where demand in the UK is insufficient. 

“Our manufacturers rely on exports to grow their businesses and imports to complement their use of domestically produced ingredients and raw materials. Our restaurants and retailers need access to a full range of goods all year round to balance seasonality and meet consumer demand,” FDF explains.

COVID-19 is flagged by the organizations as the biggest threat the UK has faced in decades. “It is therefore not surprising that this creates huge challenges for the UK. Our food and farming industries are working hand-in-hand with departments across the government on a daily basis to ensure that consumers have continued confidence that there will be adequate supplies of food and drink.”

“Now more than ever, it is critical that we keep imports and exports of food and drink flowing. Essential movements of ingredients and raw materials must continue so that we can supply consumers across the UK. The UK food and drink industry calls on all governments to ensure trade continues to flow freely and without restriction, so that together we can come through this incredibly difficult time stronger than ever,” the associations conclude.

In recent moves, the UK government temporarily relaxed elements of competition law, allowing etailers to share data with each other on stock levels, cooperate to keep shops open, or share distribution depots and delivery vans. Consumer impact of COVID-19
UK retail sales have declined 4.3 percent over a span of five weeks during the coronavirus crisis, according to the British Retail Consortium (BRC)-KPMG Retail Sales Monitor for March 2020, marking a historic low. In the last few weeks, however, supermarket chain Tesco reported that UK panic buying is “stabilizing” with “more normal” sales volumes being observed.

In recent moves, the UK government temporarily relaxed elements of competition law as part of a package of measures to allow supermarkets to work together to feed the nation amid the outbreak. The move allows retailers to share data with each other on stock levels, cooperate to keep shops open, or share distribution depots and delivery vans. 

Meanwhile, the ongoing pandemic continues to cause fluctuations and unexpected increases in demand for some foods and ingredients. A wave of panic buying and stockpiling food products that disrupted the British food supply was noted in previous weeks, with an obvious shortage of eggs and flour, suggesting that many consumers are trying their hand at baking from home.

In other COVID-19 related developments on FoodIngredientsFirst, closures of foodservice outlets around Denmark due to quarantine measures have led to repercussions for the Danish food value chain. 

For more of these coronavirus-related industry updates, readers may visit our new daily news feed entitled “COVID-19 updates,” for relevant insights needed to guide your business through this challenging period. 

By Benjamin Ferrer