Leading retailers need a strategy - and quick - to deal with structural changes in supply chains if quality British meat supply is to survive

Our three largest retailers - Tesco, Asda and Sainsbury's - refuse to tell The Grocer whether the imminent potential collapse of the UK pig industry is of any consequence to their businesses (Wolf at the Door, Meat & Fish, The Grocer, 19 April, p22).

They remain silent also on how they justify increasing retail prices of pork products when pig farmers are getting little more money. The former director general of the BRC even says "our farmers, with a few exceptions, are doing very well thank you!"

This is a shameful situation that I suspect applies to many categories and sectors and exposes those retailers' claims of corporate social responsibility as a sham. The depressing truth is, the retailers concerned don't have an answer. They have no strategy beyond next week's trading figures.

The consequences of that are dire - certainly to producers in the short term, but also to consumers in the longer term as high-quality, high-welfare Quality Standard mark pork, bacon and ham will start to disappear.

The Grocer's report came in the same week that The Economist described current global food shortages and warned of the misery, strife and political and social unrest around the world that would be caused by sharp food price increases.

British pig producers have been campaigning since last autumn for fairer prices from retailers to reflect escalating feed costs. We have been encouraged by the support of consumers who in all research have consistently indicated their willingness to pay more for Quality Standard meat produced in high-welfare systems.

This is also borne out by increased consumer purchasing - up 10.3% in the 12 weeks to 23 March [TNS].

One can only imagine their surprise to discover that price increases of recent months have not reached farmers. Retail prices are up, on average by 12%, but producer prices only 6%, so where's the extra money going? That the answer may prompt a breakdown in trust with consumers may explain any reluctance by retailers to comment.

Producers regularly point out to retailers the consequences if they do not receive a fair deal. That clock started ticking some months ago when producers took the decision to cut capacity. The eight to 10-month lag between action and consequence is now slowly but surely reaching its inexorable denouement. Any hope that imported product could fill the gap will become increasingly forlorn, because producers worldwide are genuinely reducing capacity.

These so-called leading retailers are incapable of explaining how they intend to cope with the situation. There is no strategy to protect supplies of high-value/high-margin UK welfare categories in which retailers and British producers alike have invested heavily. So many buyers and executives, having been brought up on a diet of price deflation and surpluses in the past 30 years, now sit like rabbits transfixed by a car's headlights.

Producers, shareholders and consumers alike deserve better. Waitrose, for example, has recognised the problem and adopted a structured approach to pricing that takes account of farmers' costs, retail prices and market rates.

That's not simply a desire to keep British farming heritage alive; it is a prudent, strategic and long-term approach to doing good business. n

Richard Longthorp is a

pig farmer from Yorkshire

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