“Wafer thin” and often negative margins have pushed much of the poultry supply chain to “breaking point”, 2 Sisters Food Group president Ranjit Singh Boparan has warned.
The price of chicken had been “more or less the same” in the supermarkets over the past year, making it one of lowest inflation rates in fresh food, Singh said this week.
As production costs and inflation soar, “this is unsustainable and can’t continue”, he said.
His comments followed the prime minister’s food summit on Tuesday, which looked to address issues in the supply chain.
Danger
Singh described the summit as “a start” but warned much more needed to be done to address the “clear and present danger” to food security. The finger of blame didn’t just rest with supermarket pricing policies, he argued.
“We need to look at the bigger picture if things are to improve,” Singh said, pointing to the influence of “energy cartels” on the profitability of food businesses.
“The reality today is that retailer margins are wafer thin,” he told The Grocer. “The whole supply chain needs remodelling and simply pointing at retailers in isolation is wrong,” he argued.
“UK retail combined generates a fraction of the profits of the oil companies, so why is this being ignored? Control the energy companies, end the war and let UK food have access to a plentiful supply of labour,” he urged.
“These three things alone would make a huge difference. A massive partnership effort is required by all, and I don’t just mean private enterprise – I mean the government stepping up and getting serious about this.”
Chicken production volumes are down 10% since March, according to the British Poultry Council – driven by the impact of rising costs.
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