Food insiders warn UK farm resilience under threat

Farmers are being left to shoulder the financial risks of an increasingly volatile food supply chain as retailers and manufacturers pursue short-term sourcing fixes, senior industry figures have warned.

A group of anonymous professionals from major UK food producers, manufacturers and retailers said extreme weather, biodiversity loss and soil degradation were already reducing yields, quality and reliability of supply.

See also: Food security overhaul urged as volatility is ‘new norm’

The warning comes in a memo co-ordinated by Inside Track, a UK non-profit which brings together senior professionals from major companies to raise concerns about social and environmental risks within their industries.

Addressed to investors, owners, bondholders and creditors, the memo argues food companies are responding to disruption by switching ingredients or sourcing regions rather than investments in their supply chains.

“More complex supply chains and lower yields mean higher costs – at present these are being passed down to suppliers and farmers,” the group said.

It said farmers needed “long-term and reliable income” to invest in adaptation and questioned whether contract lengths, pricing and supplier investment were enabling producers to maintain productive capacity.

Moving away from suppliers following weather-related disruption could leave farm businesses unable to recover, ultimately reducing future supply, it added.

Ana Cuddeford, head of investor engagement at Inside Track, said: “Our insiders tell us that boards are neither asking the right questions to understand the risk the industry is facing nor allocating the time, energy or budget to materially reduce that risk.”

NFU president Tom Bradshaw said farmers carried “a growing and disproportionate share of the risk, especially in England where government direct support has all but disappeared”.

If food security was national security, “as the government has rightly recognised”, policies and investment were needed to back British farming, he added.

Impact on livestock

The memo warns that failure to take a longer-term approach could affect “the future of UK livestock farming as we move to lower welfare imported alternatives”.

Insiders at major manufacturers and retailers, who have traditionally pushed “buy British” messages around meat, are understood to be increasingly looking for cheaper alternatives and imports.

Sources told Farmers Weekly that higher importing costs can be offset by lower-priced meat produced to lower welfare standards.

The group said inadequate investment in resilience could mean reduced choice, higher food prices, greater competition for land and water, and farmers writing off entire crops or herds.

British Meat Processors Association technical policy manager Nan Jones said resilience could not simply mean changing where food was sourced.

“If climate change and geopolitical instability are global risks, we cannot assume there will always be another reliable source to turn to,” she said.

“Resilience requires investment, and that can’t fall on one part of the supply chain,” she said.

New era

Professor Tim Lang, emeritus professor of food policy at City St George’s, University of London, said the post-war model of intensification was “fraying”.

The UK was “entering a new era. But it’s one that policymakers have not yet grasped,” he said.