McCain has announced a £25m investment in potato farming aimed at future-proofing the industry.
The frozen chips giant said 40% (£10m) of the money would be provided this year to help farmers recover from two consecutive poor harvests and the coronavirus pandemic. The rest will be made available over a five-year period.
The main elements of the package include a three to five-year loyalty scheme – under which McCain would be locked into contracts, allowing growers to deal more easily with banks and lenders – and a grower grant fund that would see McCain take on 25% of the cost of infrastructure investments, such as irrigation work.
The processor said it had also committed to honouring contracts over the Covid-19 period and ‘optimising’ contracts for early varieties to ensure farms received sufficient returns – a process that would be advised by third-party agricultural consultants.
Processors facing another shortage of UK potatoes following heavy rain
“At McCain, we are so integrated into both our businesses,” said McCain GB & Ireland regional president Howard Snape.
“We need the potato farmers to succeed for our business to succeed. Ninety-five per cent of our product is generated through potatoes and processed potatoes are key to that. Not enough investment has gone into British agriculture. Part of it is down to confidence levels, part of it is down to returns, [so] we’ve taken a leadership position.”
Snape said so far there had been 83 applications for funding from McCain’s grower base.
NFU president Minette Batters welcomed the move, saying she was “pleased” to see McCain providing “much-needed” investment.
“Growers need all the support they can get to have the confidence to grow into the future,” she said. “We look forward to working with McCain to help ensure that British potato production has a strong and sustainable future.”
Lockdown sales
Looking back over the lockdown, McCain said it saw a 40% spike in volume sales during the initial panic-buying phase, and had received unexpected praise for fulfilling its orders, according to Snape.
“I had a couple of retail MDs ring me up to say thank you - I’ve been in the industry 20 years and it’s unique to get someone ringing you to thank you for maintaining supply,” he said.
Coronavirus and Brexit causing increased costs for produce importers
While the initial shutdown of foodservice had led to the furloughing of some of its staff, Snape said 95% of them were now back at work.
Between 60-85% of McCain’s foodservice customers, including major QSR outlets and pub chains, were back online thanks in large part to the government’s “very positive” ‘Eat Out to Help Out’ scheme which started last week, he explained.
Meanwhile, McCain was supporting independent outlets by offering them their first order free of charge, Snape said.
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