Fresh Produce

Summer has arrived! A lot of UK produce starts to come into season at this time of year and throughout the months of July and August we will start to see an array of wonderful UK produce.

Pricing Update

UK broccoli and cauliflower (the two biggest problematic produce lines of late) are now fully UK. Produce quality and yields are excellent, however, restriction on overseas travel has increased labor issues and ultimately kept the price marginally higher than we would normally expect for this time of year. We are monitoring both lines closely across the UK and should expect to see an ease late July/early August.

Bramley and cooking apples are still very strong on price, due to an overall shortage in supply. Other apples are readily available – however, southern hemisphere supply has driven the price up again for July.

Carrots and potatoes are still tricky as we await the main crop for UK on both. There are some UK carrots available, but the quality is the issue here and French carrots have the majority of supply in the UK. Potatoes are largely UK with the exception of some Israeli small mids and Moroccan white washed. Prices have eased slightly on potatoes and will be slightly better priced for July.

Some UK peppers are available with UK main crop ready as early as mid/end of July. Mainly Dutch peppers are in supply, but with the combination of both, prices have eased a little more.

Great buys this month

Spring greens
Cauliflower
Broccoli
Iceberg
Little Gem
Cos
Courgette
Cabbage – Primo
Cabbage – Savoy (from mid- July)

Tomatoes
Lollo Rosso
Curly Endive
Oakleaf
Strawberries
Blueberries
Courgette
Baby leaf salad
Plums
Melons (Spanish to start in July)

Produce to buy with care

Leeks (Spanish)
Parsnips (Spanish & French)
Pears – Southern Hemisphere (South Africa & Chile)
Citrus – Grapefruit, Lemons, Nectarines, Clementine’s, Satsuma’s (Southern Hemisphere)
Root Veg – Parsnips, Swede, Turnips

Pork

Pork prices continued their slow upward trajectory this week. Pricing is still 17% above the 5-year average and 14% higher than the same period last year, with prices looking set to remain at these levels and continued small weekly increases expected.

This is a direct result of critical global factors including African Swine Flu and the effects of Covid-19. China has also started repopulating its pig houses; industry reports suggest as many as 10 million are required.

Beef

Since the lockdown due to Covid-19 and the closures of foodservice outlets there has been a large surge in demand for forequarter cuts, which in turn has given the beef industry a large imbalance of the carcass. The public have been purchasing more meat for home consumption with an upsurge in mince, diced and roasting joints particularly. Therefore, the normally cheaper forequarter is now on a parallel with the hindquarter. As demand for these cuts went up, so did the pricing. We have seen 25% plus increases in the cost of these products.

The fact that some fast food chain operators have now re-opened their doors has increased the demand for manufacturing beef. The recent extra demand for manufacturing beef has seen some strong growth in pricing – up 7% for cull cows over the last few weeks.

Deadweight pricing for prime cattle has been increasing over the last few weeks, with pricing now 6% higher than the same period last year and well above the 5-year average. The supply of prime cattle has been lower than normal and is expected to remain tight.

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Lamb

With Spring lamb now in full flow and old lambs diminishing, pricing has remained higher than normal. From the beginning of the year lamb pricing started to rise – with fewer imports coming in and more UK lamb being exported, pricing went up 15% in the first weeks of January and has maintained those levels since.

The lack of imports into the UK and mainland Europe, mainly from New Zealand due to Covid-19, has had an impact on pricing in the UK. New season lamb is 12% higher than the same period last year and 10% higher than the 5-year average.

Prices look set to remain at these levels with slight movements dependant on supply and demand.

Poultry

The poultry market has calmed following a period of turmoil in March which saw price increases of 35%. Pricing on most poultry products has come down from these heights and remains quite steady, with slight movements up and down 5-10% on a weekly basis, mainly due to supply and demand.

All pricing is set to remain stable until foodservice businesses and schools reopen properly. It’s possible that then we could see another high rise in pricing, with demand for certain products reaching higher than normal levels.

We will review the market mid to end of August and if necessary, change our pricing so that we can maintain the supply chain.

Dairy

Wholesale prices generally went up in June. Demand from the retail sector remained strong, while the gradual easing of restrictions in Europe and the UK has lent some support to the foodservice sector. On the supply side, prices have tightened as milk comes down from the peak, potentially emphasised by the dry weather.

The month started with an uplift in prices for fat, as demand remained good and volumes came down from the peak. After the initial rise, prices stabilised for many and stayed consistent through the middle of June. Demand was good, particularly for fat to be sold as cream; prices are currently a little above the butter markets.

Butter

Butter prices partially followed cream and rose on the month but not to the same extent. The spot cream market is currently above the spot butter market. The increased demand in Europe also continues to have some influence on the market. Some reports suggested spot trading was a little quiet this month.

Eggs

The unprecedented egg sales over the past few months show that the UK’s love affair with eggs is as strong as ever and this provides some huge opportunities for the industry to continue to grow the market – there are so many reasons to be optimistic.

Cheese

Mild Cheddar movements were a little more mixed, with some reporting slight increases and some reporting stability. High retail demand is affecting cheddar supplies, though this is mainly affecting the mature end of the market. Some reported increasing interest from the foodservice side as the market slowly reopens.

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Supply Prices

Trade patterns will be disrupted as economies recover from the pandemic, but also due to the uncertainties linked to Brexit and future trade agreements with key partners. This could cause prices in the UK to diverge from global trends and increase risk for manufacturers.

Consumer demand for dairy products at a global level is expected to weaken due to slower economic growth, although the impact will vary by product. However, supply and demand imbalance will lead to some stock build-up at a global level, keeping dairy product prices under pressure for the remainder of the year.

For most of our dairy supply partners the last three months has been tough. Prices are still holding firm and look set to stay that way on key dairy lines for the foreseeable future, with further updates planned throughout the coming months. As a business IDC will continue to support our dairy supply partners ensuring we adapt to our customer’s needs and delivering the best option for their businesses.

Hopefully as more foodservice, hospitality and coffee shops open over the next weeks the dairy industry will start the long process of recovery to pre Covid-19 conditions. Only time will tell how long this will take, but leading industry experts are saying that it will be 2021 before we start to experience normality again.

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