With almost 2,000 workers downing tools at a port handling just under half the UK’s container traffic, it’s no wonder the food industry is on edge.
Shane Brennan, CEO of the Cold Chain Federation, says the eight-day walkout means “more pressure on a [supply] chain that is already tackling rampant cost inflation, long lead times and labour issues”.
The workers – vital links in those stretched supply chains – are protesting wages and proposed pay hikes they say reflect neither the latest official 10.1% inflation rate nor what trade union Unite says were £198m in dividends paid since 2017 to mostly Hong Kong-based shareholders.
Blaming the union, the Port of Felixstowe said in a statement last week that it was “disappointed” the workers snubbed a “fair” pay rise offer “of over 8%”. Unite said the offer was 7%.
While negotiations might have collapsed, with the antagonists at odds over percentages, they at least agree on one thing.
Unite says the strike “will have a huge effect on the UK’s supply chain”. The port says it “regrets the impact this action will have on UK supply chains”. And the nation’s food industry concurs, for the most part.
Goods typically passing through Felixstowe’s container port are durables – clothes, electronics, furniture – rather than the shorter shelf-life food items that sometimes come through mainly roll-on roll-off ports such as Dover.
All the same, hundreds of millions of pounds’ worth of food – including lamb, rice, nuts and dairy, according to the NFU – passes through Felixstowe, which also caters to roll-on roll-off, each year. Around 2% of the UK’s food imports from the EU make landfall at Felixstowe, according to Defra. Dominic Goudie, head of international trade at the Food & Drink Federation, says the strike will “inevitably” have ”some degree of impact” on the industry.
The Suffolk port is one of the UK’s main links to Rotterdam, Europe’s biggest port and a waystation for food shipped from further afield, such as rice from Asia and soy from Latin America. And Felixstowe is a key hub for trade with the Netherlands, which last year was the UK’s biggest country source of imported food, official data show.
No wonder, then, that British Frozen Food Federation CEO Rupert Ashby says the strike means more “pressure” – that word again – “for those who import ingredients and export finished products”.
And in a country that imports what at last count was 46% of its food, that’s a big worry – even if some in the industry have, so far at least, not felt any impact.
“We’ve been quite lucky in that for some of the goods we deal with, it’s off season”, says Mike Parr, MD of PML, which handles import-export logistics for fresh food businesses from bases near Heathrow Airport and Dover. “At another time of year it could have been chaos,” he says.
Parr says that because the stoppage was flagged weeks in advance – though not confirmed until 5 August – food traders could make contingency plans.
Some freight from the Netherlands, according to Wilma van de Oever of the Dutch Fresh Produce Centre, could ”divert to ports such as Harwich, Killingholme and Dover”, while others could switch to Southampton or London Gateway, the port of choice for Anglo-Dutch fresh food importer Davis Worldwide.
The BMPA says though Felixstowe typically handles chilled and frozen meat, consignments can be sent instead to Hull, while Brennan says there is “spare capacity” at other container ports as well as the option “to land in northern Europe”.
But if the strike sees UK-bound ships detouring to the continent and the goods sent by road under the English Channel, it will add to cost pressures faced by the food industry, Goudie says. There is the prospect. already raised, of Dutch and French port workers refusing to handle re-routed goods in “solidarity” with Felixstowe comrades.
And as people struggle with the rising cost of living and employers do likewise with the soaring cost of doing business, there could be more industrial unrest to come.
The big worry, according to many in the food industry, is the prospect of workers at other ports emulating counterparts at Felixstowe and Liverpool, where workers have also voted to strike.
Rail and bus workers have gone on strike multiple times this year, with postal workers, nurses and barristers set to follow, in a possible reprise of the so-called Winter of Discontent in 1978.
Simultaneous copycat strikes at several ports is the nightmare scenario for not only the food industry, but the UK as a whole.
“The country could be brought to a standstill,” Parr warns.
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