The consolidation of the fresh produce sector was discussed at an Oxford Farming Conference. Attention was drawn to the vegetable sector in particular, which is down to a handful of businesses with massive turnovers and massive amounts of risk, operating on wafer-thin margins of often 1% to 2%.
Chief Executive of the British Growers Association, Jack Ward, summed up that the whole sector has been stripped of any superfluous activity.
“There is an increasing gap and lack of understanding between the harsh economic realities of producing food in the 21st century and the consumer expectation for ever-cheaper costs of food and the broader expectations around other aspects of the supply chain,” he said.
“If you talk to any growers at the moment, you’ll get a pretty consistent kind of story. They are mostly facing an irreconcilable dilemma of rising, even escalating, input costs and consumer expectations on the one hand, and static prices and static returns on the other hand. We have to really look at what this is doing to the sector.”
“This sector really leads the way in terms of being the squeezed middle. I think for a lot of growers, they feel as though they are between the rock of rising prices and the hard place of consumer expectation.”
“Growing veg at these prices may be doable, it may be achievable. It is happening at the moment, but I think the point that we, as growers, as consumers, as society, as government, as retailers, really need to address: is this situation sustainable?”
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