Margins across the whole food supply chain have become so tight in recent months that there is ‘no room’ for a fair redistribution, AHDB chairman Nicholas Saphir has said.
Speaking at NFU Cymru conference last week (November 6), Mr Saphir pointed out farmers had been talking about supply chain fairness for a long time, but the UK was still pursuing a ‘very cheap food policy’ which has been driven by competitiveness.
“I would have argued maybe a few months ago that there was room in the supply chain for redistribution of margin, but I would say there is no room anymore – whether that be the retailer, the supplier or the farmer,” he said.
“We have an issue with a supply chain which is really as tight as it can get.”
Despite this warning, Mr Saphir insisted he was optimistic about the future for UK agriculture, because there are big opportunities to boost exports and productivity.
He explained the UK ‘lags way behind’ on exports when compared with the French, the Germans, the Dutch or the Danes.
And he suggested there could be big wins in the USA.
“If you get it right, there is a fantastic market out there,” he said.
“Look at Ireland. Kerrygold is the second-largest butter brand in the US. 34,000 tonnes of butter goes from Ireland into the States.
“Do not tell me there are not opportunities for us.”