Crisis in Ukraine could pose a major threat to UK food security and result in inflation in the sector hitting 15 percent by mid-year, chief executive of the 2 Sisters Food Group warned on Wednesday (9), adding that UK may see hyper-inflation not seen for 50 years.
2 Sisters Food Group’s CEO Ronald Kers has also pinpointed out that unfolding Ukrainian agricultural crisis could have massive repercussions for global commodity supply.
“The events in Ukraine are an unimaginable tragedy and our hearts go out to those affected and to our Ukrainian colleagues and supply chain partners and their friends and relatives back home. It is an incredibly worrying time and we will do all we can to support them,” said his statement on the group’s website.
“This conflict brings a major threat to food security in the UK and there is no doubt the outcome of this is that consumers will suffer as a result. War disrupts the free flow of trade and the impacts for us are severe. For example, the input costs of producing chicken – with feed being the biggest component – have rocketed.”
Prices from the farm gate have already risen by almost 50 percent in a year, he said.
“Before this war began, four to five per cent food inflation was being forecast by mid-2022. But we now could see a hyper-inflationary environment at closer to 10 to 15 per cent – more than it’s been for 50 years – if this conflict isn’t resolved quickly.
“Our business is heavily dependent on a stable agricultural sector, but we cannot isolate ourselves from events abroad, even if Ukraine seems like a far away place. Commodities like animal feed and CO2 are vital for us.”
Kers also pointed out food production clock is ticking.
“Ukrainian farmers should be sowing crops in March, instead they’re fighting for their country. If this war is not stopped now, the UK could experience a major drop in supply of products like wheat, barley, corn, rapeseed, and sunflower oil,” he said.