UK threat

The UK has a highly successful agricultural industry, but many domestic and international factors affect food production and prices for consumers in the UK. This became evident during the world food price spike of 2008.

The food and drink supply chain is the UK’s single largest manufacturing sector and accounts for 7% of GDP, employs 3.7M people and is worth £80Bn per year (ref 1). 

But although the UK has a thriving farming sector – it exported £12Bn of food and drink in 2007 (ref 2) – Britain is not self-sufficient in food production; it imports 40% of the total food consumed and the proportion is rising (ref 1). Therefore, as a food-trading nation, Britain relies on both imports and thriving export markets to feed itself and drive economic growth.

Behind the always full-looking supermarket shelves lies a supply chain that is sensitive to economic and environmental events. Too much or too little rain can reduce harvests. Emerging exotic diseases such as bluetongue and African swine fever threaten to devastate livestock industries.

The UK is also exposed to volatile global markets for products such as animal feed that have strong impacts on supermarket prices. In the interconnected world, it's consumers that have to pay more downstream, as they did in 2008.

The 2008 food price spike

Early 2008 saw the culmination of astonishing food price rises. The price spike brought an end to the long-term decline in relative price of food in the UK, and few expect it to return to past lows.

On the global markets, the 12 months to March 2008 saw the wheat price rise 130%, soya by 87% and rice jump 74% (ref 3).

These price rises on the global commodities markets had a rapid and significant impact for UK consumers. In a BBC survey of household UK shopping, general items such as tinned foods registered a 15% price increase and 7 items in the survey jumped by more than 40%. A pack of 4 croissants was 47.4% more expensive and a 125g packet of ham went up by 45.4%. Other surveys showed that fruit and vegetables saw some of the biggest price rises – up nearly a third at the major supermarkets from 2007-08 (ref 3).

Food price rises affect less wealthy families hardest. The poorest 10% of UK households spent 15% of their expenditure on food in 2005-06 (after which food prices increased significantly), a figure that was just 7% for the richest 10%. This is because low income consumers spend proportionately more on milk, eggs and bread – staples that are hard hit by food price rises (ref 1, ref 4).

 

From bad to worse

Pressures on the UK’s food security are here to stay. Increasing global population and changing consumption patterns are increasing demand for foodstuffs and contributing to upwards price trends. However, the threat to UK food security could be more serious should increased global demand combine with other potential problems.

One emerging concern is the bluetongue virus. A disease that mostly affects sheep, it is transmitted by the Culicoides biting midge. As the weather has warmed in recent years, the geographical range of the midge has spread north, arriving in the Netherlands in 2006 and with the first confirmed outbreak in the UK in 2007. Since then, the disease has gone on to strike Norway in 2009.

Video: Midge-hunting scientists tackle bluetongue virus

Duration: 0:05:18, Read video transcript