The future of the United Kingdom’s fruit and vegetable industry hangs in the balance as some of the country’s prominent horticulture businesses shelve growth plans due to a sharp increase in production costs over the past two years. A recent report commissioned by the National Farmers’ Union (NFU) and conducted by Promar International reveals that production costs have surged by up to 39%, posing a significant risk to the sector.
Key inputs contributing to this surge include a staggering 218% rise in energy costs, a 47% increase in fertilizer expenses, and a 24% uptick in labor costs. Favored crops like strawberries, tomatoes, apples, and lettuce are particularly affected by these escalating costs, according to the report.
The study underscores that these heightened production costs, coupled with the ongoing global volatility, are becoming the ‘new normal,’ with businesses not anticipating any imminent relief. NFU Horticulture and Potatoes Board Chair, Martin Emmett, expressed serious concerns about growers contemplating production cuts amidst ongoing uncertainties related to costs, workforce planning, and challenging supply chain dynamics.
Emmett stated, “We are now facing the third year of unprecedented and highly volatile costs of production, coupled with ongoing uncertainty about the availability of permanent and seasonal workforce and supply chains that return little value back to growers.”
He emphasized the need for government support in key areas, citing the NFU’s growth strategy with ten critical building blocks, including sustainable energy supplies, access to skilled labor, productivity investment, and fair supply chain practices. The report also calls attention to prolonged contract negotiations and planning cycles misalignment, making it difficult for growers to plan for the long term.
Emmett urged the government to back fruit and vegetable growers with decisive action and ambition, aligning with its own Food Strategy. He highlighted the necessity of a consistent plan for seasonal labor, including a five-year rolling Seasonal Workers Scheme, and sustainable returns with longer-term contracts for growers.
In conclusion, Emmett stressed, “To ensure we have a thriving UK horticulture sector, we need to see the Government back our fruit and vegetable growers with action and ambition.”