Chicken will cost more because of Ukraine crisis, minister warns of 8% food inflation Business News

The price of chicken will soon soar at the supermarket due to the Russian invasion of Ukraine, Environment Secretary George Eustice has warned.

The minister also warned that Britons will face food price hikes of up to 8% this summer as Chancellor Rishi Sunak comes under pressure to help families struggling with the growing cost of home crisis. life.

Mr Eustice warned that the impact of rising global wheat prices – Ukraine being a major exporter globally – would impact the cost of living in the UK.

In a speech to the Food and Drink Federation, the minister said rising costs of feed used by poultry farmers would have a particularly strong impact on the price of chicken at the supermarket.

“Basically there are three or four very large poultry producers in this country,” the environment secretary said.

He added, “They have a situation where feed costs are about half of their input costs, and they see a cost pressure of about 20-30%. At some point, this has to power the system.

Mr Eustice said officials had estimated food and drink inflation could reach 6% over the summer, but price increases could rise to as much as 8%.

Experts have warned that the invasion of Ukraine could wipe out most of the country’s grain exports this year, driving prices up sharply and adding to financial pressure on British households.

Known as “Europe’s breadbasket”, the country is expected to account for 12% of global wheat exports and almost a fifth of global corn production this year, according to figures from ING Bank and the US Department of Agriculture.

Last week Ronald Kers – chief executive of 2 Sisters Food Group, one of the country’s biggest food producers – warned that food prices in the UK could soar 15% by the middle of the month. ‘year.

He warned of a particularly acute spike in chicken production costs, which is expected to be aggravated by the Ukraine crisis. “This dispute poses a major threat to food safety in the UK and consumers will no doubt suffer as a result,” he said.

“Input costs for chicken production – feed being the most important component – ​​have skyrocketed. Farm gate prices have already risen almost 50% in one year,” Kers added.

Mr Eustice also revealed on Tuesday that the government’s food resilience forum set up to deal with the Covid and Brexit crises now meets once a week.

It comes as opposition parties, business groups and consumer experts have all called on Mr Sunak to step in to support energy costs as he prepares for Wednesday’s spring statement.

Money Saving Expert founder Martin told MPs that families would face a ‘tax punch’ on April 1 with the impending rise in energy prices.

Mr Lewis stressed that the Chancellor’s current package of measures to reduce fuel bills, including a £200 rebate to be refunded, was “clearly not enough”.

Meanwhile, several business groups, representing both big and small businesses, told MPs the government was listening to their concerns – but there had been very little action so far.

“We argue that, given the scale of the cost increases that businesses are facing, it would be right for the Chancellor to step in and provide something analogous to this support that has been provided to households,” Paul Wilson said. , director of policy at the Federation of Small Businesses.

Mr Sunak is reportedly preparing to cut fuel taxes by up to 5p per litre. However, a 5p per liter cut in fuel tax would fail to reverse even half of the price increase inflicted on motorists over the past fortnight, according to new figures.

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This notice was published: 2022-03-22 15:38:28

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