Some effects of Brexit and the pandemic on grocery
What do we have to look forward to in the world of retail in 2021? Two things – Brexit and COVID – are dominating the news.
The effects of Brexit
Some grocery websites have been showing some fruit and vegetable items to be out of stock. January is usually a quiet period but travel delays and bureaucracy have had an effect on supplies. The additional paperwork is adding to costs, which will have an effect on prices, and some hauliers are avoiding cross channel routes, which will reduce the available capacity.
The Government warns that the problem will get worse before, they believe, getting better.
The Food and Drink Federation are saying that large consignments that previously took 3 hours to import can now take 5 days.
The major food retailers import food from all over the world and are likely to be able to adjust to new regulations, given enough time. They are also capable of building new supply chains if they need to. But expect some price rises.
There are particular problems supplying Ireland and six major grocery retailers are warning of further disruption. They want a continued period of grace and further talks with the EU.
Much of Ireland’s food comes from other EU countries and passes through the UK., The EU was concerned that food from other countries could use the UK as a back door way of avoiding EU tariffs. Much of the paperwork that has caused problems revolves around “rules of origin” designed to prevent this.
It seems likely that the EU will agree to changes, which have been requested by the Government of the Republic of Ireland, as it will want to mitigate problems caused to an EU member country.
In the meantime some ferries that served the UK from Ireland have been diverted to serve routes to France.
A few of the changes to shopping habits caused by coronavirus
The pandemic has seen a major increase in the numbers of people buying groceries online, which is set to continue.
It seems likely that the discounters will also move into online wrestling. There is also speculation that Amazon could buy a major supermarket – with Morrisons and Tesco the most likely.
Concerns remain about the effects of COVID on workers in the food supply chain. Arla is warning of possible milk shortages, and are arguing for early vaccinations for workers in the food industry. Given that similar calls have been made for school staff and the police, it seems unlikely that Arla will be listened to.
The pandemic has seen a reduction in the market for ready meals (especially chilled) and an increased awareness of healthier options. That looks set to continue. Sales of vegan products have grown, partly because of health and environmental concerns, and possibly because their range and quality have improved.
Products that are seen as environmentally friendly have also become increasingly popular. Supermarkets may change store layouts to promote eco friendly goods, and it is also possible that regulations on misleading environmental claims may be tightened.
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