UK poultry supplier warns food prices could rise by 10%

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UK poultry supplier warns food prices could rise by 10%

The owner of the UK's biggest poultry supplier has warned that the cost of chicken is expected to rise by more than 10%, adding that food in Britain is too cheap. In a strongly worded intervention, Ranjit Singh Boparan, owner of Bernard Matthews and 2 Sisters Food Group, called for a reset on pricing to reflect the true cost of producing food

Why is chicken less expensive than beer? You re looking at a different world where the shopper pays more, he said on Wednesday.

Bernard Matthews and 2 Sisters Food Group produces about a third of the poultry products that are consumed by people in the UK.

Chicken is the most popular meat in the country, with chicken consumption significantly outperforming beef, lamb or pork. Any price increase is likely to have a disproportionate effect on lower income families.

Boparan, whose facilities in the UK and Europe process more than 10 million birds a week, said Britain was entering into a new era: one in which labour shortages and commodity price rises would mean less choice and higher prices.

He said rising inflation was weakening the food sector s supply chain and government could not fix the problem.

The days when you can feed a family of four with a 3 chicken are coming to an end. We need honest pricing. This is reset and we need to spell out what this will mean, he said.

Food is too cheap, there s no point avoiding this issue. Is chicken in New Jersey cheaper than chicken in London 10 years ago? The group s 600 farms and 16 factories that employ 18,000 people are facing high energy costs, which Boparan said had risen between 450% and 550% last year.

He said wages were up 15% as were feed costs for the poultry, while other inputs including diet supplements, wood shavings for litter, disinfectants and veterinary costs were up as much as 20%.

Alongside wage increases for HGV drivers, who remain in short supply, fuel costs are currently at their highest rate since 2013.

Inflation is reducing the supply chain infrastructure and the food sector’s ability to operate as normal. That s from chicken to plate, said Boparan, who is nicknamed Chicken King because of his position in supplying major high street retailers.

He said he needed to invest in increasing automation to secure the future of his operations, adding that inflation could reach double digits in the short term because of the wave of cost increases.

We really have to start thinking about what our food priorities are and how much they cost, said Boparan.

He welcomed temporary seasonal visas for poultry workers which the government had brought in to ensure Christmas turkeys were ready for the festive season, but said that in the longer term. Less labour means less choice, core ranges, empty shelves and wage inflation.

I need to work with my suppliers and customers to solve these issues, but it will come at a cost. Boparan is the latest to warn of food price inflation as global commodity prices rise, which are linked to re-invigorating trade as the pandemic eases in key areas like the US and western Europe, combined with production issues caused by a mix of the climate crisis and shutdowns related to Covid - 19.

The UK has also experienced a staff shortage as the flow of workers from the rest of Europe who made up a high proportion of those working in food processing has been slashed since Brexit.

In the summer Food and Drink Federation, which represents thousands of food producers, said food prices could increase by about 5% in autumn and turkeys and pork products could be in short supply this Christmas because shortages of delivery drivers, abattoir staff and other workers drove up pay and other costs.

Grocery prices were up 1.7% in the four weeks to October 3 according to analysts at Kantar compared with the same period one year before.