British Growers has outlined a future in which it believes there are extensive opportunities to raise the competitiveness, profitability and UK market share for British producers of fresh fruits and vegetables. Ahead of his seminar presentation at The London Produce Show and Conference 2018, PBUK speaks with British Growers CEO Jack Ward about the UK’s opportunity to be more self-sufficient in fresh produce and the significance of this objective for buyers.
Q: You’re speaking at The London Produce Show and Conference 2018 about the big opportunity to expand British fruit and vegetable production. Can you give us a sneak preview of what you’ll have to say in this regard?
A: It’s time for a massive change. The UK’s withdrawal from the EU [European Union] raises a lot of questions in the fresh produce industry, for growers in particular. But it presents some opportunities too. We’re looking at a major re-write of British domestic agricultural policy, which, for a generation, has largely overlooked the fresh produce sector. At British Growers, we think there’s an interesting opportunity to increase our market share of the UK fresh produce market, and this is the message we’ve given to Defra [the Department for Environment, Food & Rural Affairs] throughout the recent consultation process [for Defra’s Health and Harmony consultation paper].
Q: Why should this piqué the interest of buyers of fresh produce at a retail, wholesale and foodservice level?
A: Our message to [UK] government is that the UK is very heavily reliant on imports and buyers are looking purchase more produce from the UK. There is a lot of uncertainty about what future customs arrangements are going to be [post-Brexit]. If, for example, the UK introduces paperwork for lorries to cross from one side of the [English] Channel to the other, that will have massive implications for the fresh produce industry, because with perishable products, the last thing you want is to be caught in tailbacks in Calais while somebody in Dover checks the paperwork.
Q: So, the domestic expansion strategy is significant for ensuring consistent produce supplies in the UK after Brexit?
A: Brexit is a very big issue. Mike Coupe [CEO of Sainsbury’s] has spoken about the importance of having a [post-Brexit import] system that doesn’t interfere with the current supply chain. If it looks like it’s going to become difficult to get supplies from Europe, that could encourage people to ask: ‘Could we source it from the UK?’ and ‘What would it take to source more from the UK?’.
Q: Is this about managing the impact of climate change too?
A: Security of supply is becoming an issue. I recently visited a veg producer in France where climate change is nearing the top of their list of concerns. The issue here is around the volatility of weather patterns and growers no longer being able to predict, with any degree of certainty, when things will happen. In particular, extremely high temperatures at the wrong time of year are damaging to certain crops. The growers I met in northern France are now prone to temperatures of +30oC, which can present problems. So, the more we can grow on home soil, the better.
Q: How else do buyers stand to benefit from an increase in UK production? What’s the added value?
A: The advantage of produce from the UK is that the supply chain is short and you have the added advantage of UK traceability systems, plus there is still a strong ‘Buy British’ ethos. There’s also an interesting opportunity on the health and nutrition side. The UK currently consumes 250g of fresh fruit and veg per capita, and we need to be consuming 400g. If we were to see that increase in consumption, this amounts to an additional 1.5m tonnes of veg production.
Q: Although consumer sentiment to buying British remains fairly strong, UK consumers are also price-conscious. Would an increase in home-grown produce cost more than imports?
A: No. I don’t think anyone is under any illusion that the consumer is going to want anything other than the ultimate in value for money. We’re going to have to compete, but what can make us more competitive is a good pipeline of research and development, the ability to reduce risk around growing crops, reducing the costs of growing crops, and improving quality and the percentage that hits the class one standard. And for some crops, it will be purely about increasing volume.
Q: Are there opportunities for the UK to export more produce too?
A: The big opportunity is more about supplying a bigger share of our home market. There will be export opportunities, but they tend to be currency-related. Although there hasn’t been a great focus on exports in recent years, there are opportunities, and, who knows, these opportunities could increase in the future if the conditions are right.
Q: So, what did British Growers pitch to Defra?
A: The message was very much one of opportunity for the UK fresh produce sector. The UK under-consumes in fresh produce and under-produces in fresh produce. As a nation we need to increase our intake of fresh fruit and veg, and this represents a significant opportunity for the UK fresh produce sector. By increasing consumption and expanding production we will be ticking a lot of boxes.
That may sound overly optimistic but my job is to be optimistic. It’s easy to be surrounded by a sea of pessimism. But the government is really interested in anything that’s going to help make a success of the UK economy after Brexit.
Q: What support does British Growers want from the UK government?
A: The government has an opportunity to change the way in which it supports the agriculture sector. If we were to put a little bit more money into research and development (R&D), innovation, capital grants, promotion, skills development, and also to look at supply chain fairness, all of those things could make a significant contribution [to expanding UK production].
The UK has a £110bn food retail industry and a £90bn wholesale/foodservice market. So that’s £200bn of money flowing through the food industry. What we’re saying is, let’s increase our share of that turnover and improve the returns to UK growers, as opposed to it going to overseas outlets.
Q: Where do the opportunities lie for increasing UK fresh fruit and vegetable production? By how much could UK production increase?
A: That’s difficult to guess, and climatic considerations are probably the biggest determinant. But if you look at the UK’s current market shares for some of the crops that we grow, we range from [supplying] about 10 per cent up to nearly 100 per cent [of what’s sold in the UK], but there are opportunities within those two extremes. By way of example, if you look at the top four biggest fresh produce categories by value, apples, tomatoes, berries and mushrooms, there are opportunities in all these sectors to increase market share.
Q: By how much is the UK under-supplying in those four categories?
A: The UK has one of the lowest levels of self-sufficiency in protected edibles in Europe. If you take mushrooms, which is an indoor crop grown at consistent temperatures, the UK is only supplying about 45 per cent [of mushrooms sales in the UK]. If you look at pears, we’re only doing about 25 per cent of pear consumption. And the figure for tomatoes is around 18 per cent.
Q: What’s the strategy to increase UK production? How will it be possible?
A: Let’s take research and development, for instance. In a lot of areas of fresh produce, growers are very reliant on R&D to provide solutions to problems. The speed with which you can find those solutions makes a difference to your overall competitiveness. There may be opportunities to introduce more capital grants to reduce some of the risks involved with investing in the sector.
Q: Is most growth likely to come from developing technologies, or by making existing land more productive?
A: It depends on the crop because every crop is different. With apples, for example, a big challenge at the moment is the gap in the UK’s ability to supply the UK market with UK apples for 12 months of the year. This is because we don’t have the right storage facilities in the volumes that we need, and we need new varieties with the right keeping qualities. This is a question for the plant breeders. If can we get the right varieties and the right storage in place then can we start supplying apples for 52 weeks of the year.
Q: Where are you at in terms of the pitch to Defra? When can we expect any action?
A: The consultations have only been closed for a couple of weeks. I think it will be a slow process. There will be an Agriculture Bill coming out at the end of the year , but my guess is that this will be enabling legislation. Although we don’t want uncertainty, we do need the right framework in place, and that may take time to get right.
We know we’re going to work through a [Brexit] transition period, and we know there will be a further transition period for agriculture. We have a bit of time on our side to work through these ideas, refine them, get them right, and get the policies in place. We want to use this process to make sure we are well positioned with our customers and retailers for the future.
Q: What are likely to be the first steps during that transition period?
A: The most important thing is probably to give people a sense of confidence to invest. A big part of that will be around labour because access to labour is possibly the biggest talking point at the moment.
Q: I understand you’ll be highlighting in your presentation the revamp of ProduceView, British Growers’ business analytics tool for category managers. For those who are unfamiliar with the system, can you explain its purpose?
A: British Growers runs a market intelligence service that gathers data on retail prices, ranges, promotions, and country of origin. It enables users to track what’s happening at the consumer end; how many different ranges the retailers are stocking, the price of those ranges and where they are sourcing from.
Q: What’s the benefit?
A: It’s a very simple and cost-effective way of accessing key retail data in a single place. If you’re supplying a retailer, it’s quite handy to know, for any given category, how many different SKUs they are doing – whether it’s five or 10 and where they’re sourcing from (the UK or overseas). The service will also provide data on pack prices and promotions.
Q: How does it help buyers with purchasing, pricing and marketing decisions?
A: Retailers may know what their competitors are doing, but they may not have complete insight into country of origin or the full range that their competitors are stocking.
Q: Can you reveal what changes have been made to ProduceView?
A: We are bringing out new products to give greater insight into what’s happening in the [UK retail] marketplace. We’re producing new-look reports, which will make it easier to digest and analyse the data. We’ll reveal more during the presentation!
Join Jack’s seminar on Stage 1, The Great Room Balcony, at 14.30 on Thursday 7 June.
Register your place at the LPS18 here.
Explore the agenda for the event here.