The pressure points in Britain’s food supply chain
THE COVID-19 pandemic disrupted the supply chains of businesses across the entire British economy—perhaps none more so than food producers’. As a lockdown was imposed in March, they were immediately hit with critical labour shortages and reduced transport capacity, as well as huge swings in demand. Many firms were not prepared. In normal times, Britons consume about a quarter of their food in pubs, cafes and restaurants. With the flick of a switch, billions of pounds (and calories) were diverted from restaurants to retail. In a month, the grocery sector grew by 11%. Part one of the “National Food Strategy”, a government-commissioned review of Britain’s food system, published in July, offers an account of how the country handled the shock.
Broadly speaking, it held up, though it struggled amid a wave of panic-buying. Demand for some foods surged, toppling the delicate balancing-act between producers, wholesalers and retailers that keeps Britain’s supply chains working. Alcohol, meat and eggs saw spikes similar to those seen during the Christmas season. In the week before lockdown, 75m litres of alcohol flew off the shelves, more than a typically boozy week in mid-December. Since then, demand has continued to soar. In late May, sales reached 99m litres a week, a 110% increase over pre-pandemic levels. Luckily for thirsty punters, supply has held up. Marmite, the much-loved (and loathed) salty yeast spread, fared less well. With surging demand and a shortage of brewer’s yeast owing to sudden pub closures, its manufacturer, Unilever, was forced to stop producing jars bigger than 250g.
Supplies of fruit and vegetables were disrupted, too. Nearly two-thirds of the produce on British supermarket shelves in March was imported from continental Europe, making its journey to British consumers more vulnerable to disruption. Take lemons. At one point, the price of the citrus fruit spiked, leading to rumours that lorry drivers between Spain (the leading producer in the EU) and France were being forced to quarantine mid-transit. In fact, hand-sanitiser manufacturers had bought up large quantities to scent their products, a good example of the sometimes unlikely sources of threats to the supply chain.
Sales of some goods which had surged early on in the crisis—such as pasta and tinned food—have since returned to normal levels. But the growing demand for both booze and veg suggests that people may be eating more healthily, albeit less soberly. The consequences of Britain’s new dining and shopping habits will doubtless be analysed. But the lockdown has provided a valuable opportunity to expose the possible cracks in the nation’s supply chains. To avoid a repeat when the next crisis strikes—which, if a no-deal Brexit goes ahead in a few months’ time, may be sooner than anticipated—the government would do well to learn some lessons.
Author: | Post link: https://www.economist.com/graphic-detail/2020/08/16/the-pressure-points-in-britains-food-supply-chain
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