Panic-buying could get worse until labour shortage is resolved, warns food group boss
The founder of one of Britain’s biggest food producers is warning of major food shortages in the UK unless the Government acts straight away to address issues including labour shortage in the supply chain.
Ranjit Singh Boparan claims UK supermarket shelves will be bare and panic buying will intensify unless the critical issues currently threatening UK food supply are solved promptly.
The founder and president of Birmingham-based 2 Sisters Food Group, which has chicken processing factories in West Bromwich and Wolverhampton, says the current challenges facing the sector are like no other he has seen in his 27 years as a food entrepreneur.
Mr Boparan said: “I have seen lots of change over the years – but nothing compares to now. The use of the term ‘perfect storm’ has become a cliché, but never has that been a truer phase to use. No-one could possibly have predicted that this toxic cocktail would come together at this time.
"It started with the pandemic – and in the last week or so with ‘pingdemic’, but since May this year the operating environment has deteriorated so profoundly I can see no other outcome than major food shortages in the UK. Supply of chicken and turkey is under threat. Our retail partners and the wider supply chain have worked together closer than ever before to ensure we retain food supply and this is of huge credit to everyone. But we are at crisis point."
The Government has announced that food supply chain workers 'pinged' by the Covid app or contacted by NHS Test and Trace will be tested daily instead of having to self-isolate in a bid to keep shelves stocked.
However, Mr Boparan says the 'pingdemic' is not the issue.
“We are operating in a framework that’s complete madness and the Government needs to be called out for sticking their heads in the sand. ‘Pingdemic’ is not the issue for us. There’s fundamental structural changes going on here that need sorting.
"Why is the Government still paying furlough to around two million people with the economy essentially open and yet we have an on-going labour crisis?
"Why is it not reclassifying our frontline workers to the correct status so we have a corridor open for EU workers into the UK? Why is it not allowing for key workers in the food industry who are double vaccinated to continue their work when they are “pinged”?
"The Government needs to act immediately if it wants to avoid the most serious food shortages that this country has seen in over 75 years. Not acting would be irresponsible.”
He believes Brexit has acutely reduced available workers across the food sector. 2 Sisters has seen, on average, 15 per cent labour shortages for its 16,000 workforce – the majority who work in chicken and ready meal production facilities – this year.
He says the food sector has suffered major hits with ingredient inflation. Feed inflation is at an eight-year high. Wheat, soya and other components have risen by more than 50 per cent; packaging up 20 per cent; energy costs up 30 per cent. Some food sector items such as stainless steel equipment have doubled in cost
2 Sisters has seen unprecedented wage inflation across its supply chain in skilled roles; ranging from hatcheries, to farms, to logistics and delivery.
Mr Boparan said Freedom Day never existed for 2 Sisters because the heavy investment to keep staff safe will continue for at least another 12 months, regardless of Government lifting of restrictions and rules around self-isolation will continue as before, compounding the labour shortage issue even further.
He claims Brexit has not been a success as trading conditions with the new regime for import and export has increased complexity and administration and this will continue indefinitely, causing major on-cost and resource difficulties.
“These are unique, era-defining challenges which we started to tackle head on last year. But they’ve all come to a head in the past 12 weeks. Clearly these have brought continued and intensive pressure on our business, just like they have elsewhere.
“This cannot be sustained indefinitely. The critical labour issue alone means we walk a tightrope every week at the moment. We’re just about coping, but I can see if no support is forthcoming – and urgently – from Government, then shelves will be empty, food waste will rocket simply because it cannot be processed, or delivered, and the shortages we saw last year will be peanuts in comparison to what could come," he added.
