Kingsmill owner warns of price rises due to ‘very small’ expected harvests in UK | Farming

One of Britain’s biggest bread makers predicts a “very low” grain harvest in the UK and warns prices could rise as the company becomes more reliant on imports did.

George Weston, chief executive of Associated British Foods (ABF), which owns Kingsmill and Ryvita, as well as Twinings Tea, Dorset Cereals and discount fashion retailer Primark, said the group had been in the food market for the past six months. He said he had not increased prices. A period of significant inflation last year.

But he added: “The focus is on British cereals. Yields in July and August may be very low and we may have to import a significant amount of grain into the UK, which will be costly. I guess.”

He said higher prices for grains such as wheat in the UK could be offset by higher harvests in other parts of the world, but that was not yet clear.

“There are no plans to raise prices at this stage, but the cost of primary products and other inputs may rise more than expected,” he said. “The situation is calmer, if not calmer, than it was for a while.”

Record rainfall has left farmers in many parts of the UK unable to plant crops such as potatoes, wheat and vegetables during the crucial spring season. Many of the crops planted in winter and spring, including oilseed rape, are of poor quality and some are rotting in the ground.

Mr Weston’s comments come as MPs warn of a “perfect storm brewing” regarding cooking oil. Prices are expected to rise due to reduced oilseed rape production in the UK due to crop failures in southern Europe and the continued impact of the war on sunflower crops in Ukraine.

“We have a perfect storm brewing for vegetable oil and petroleum supplies,” Robert Goodwill, chairman of the Environment, Food and Rural Affairs Select Committee, said at Tuesday’s hearing. He warned that many predict that rapeseed production could “disappear from our fields”.

UK yields of rapeseed used for the production of domestic and commercial edible oils will fall by up to 38% this year compared to 2023 and by up to 54% compared to the average yield since 2015, according to analysis by It is predicted to decrease by %. Energy and Climate Intelligence Unit.

Weston also said he doesn’t expect clothing prices to fall, despite falling prices for core materials such as cotton, as well as shipping and production costs. Mr Weston said labor costs were rising in England, where the legal minimum wage was raised this month, and issues such as business rates were offsetting savings elsewhere.

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The company is also rebuilding its profit margins after declining margins in recent years, when costs rose during the cost of living crisis and the pandemic, keeping prices down.

Mr Weston said profit margins had returned to pre-pandemic levels, adding Primark “remains the most competitive retailer” in the fashion market.

He was speaking as ABF revealed sales rose 2% to £9.7bn in the six months to 2 March and pre-tax profits rose 37% to £881m. I posted this comment.