The UK is set to have stunted economic growth in 2022 and 2023, experts have warned citing recent data over the country’s reliance on food supplies from Ukraine.
New data from the Office of National Statistics (ONS) states that the UK imported £200 million worth of food and live animals from Ukraine in 2021, which primarily included imports of cereals (£130 million) such as wheat, maize, barley, and rice.
Given that it amounted to 0.5 percent of all such goods brought into the country, there will still be a knock on effect on price rises across a variety of foodstuffs. This is partly owing to fewer exports expected from Ukraine as well as global commodity price disruption.
Additionally, the country imported £140 million of vegetable oils and fats in 2021, accounting for 11.3 percent of all imports of this commodity, says ONS data.
“Fresh warning lights are blinking about the chaos unleashed on supply chains caused by the crisis in Ukraine in this latest snapshot from the ONS,” Hargreaves Landsdown senior investment and markets analyst Susannah Streeter said.
“It’s cautioned that the repercussions of the conflict aren’t yet showing up in UK trade data, but we should be prepared for significant disruptions ahead.”
Streeter pointed out that with this year’s planting season severely disrupted due to Russian invasion and farmers being sent to war, the UK may witness massive squeeze on supplies in the coming times.
The country’s inflation stands at 6.2 percent and according to the UK Office for Budget Responsibility, it is expected to peak at close to 9 percent later this year.
The revelation comes amid the warning that the country is headed towards the biggest drop in living standards since the mid-1950s, fueled by rocketing energy costs, food prices and pre-planned tax increases. Disposable household incomes, adjusted for inflation, are expected to fall by an average 2.2 per cent this year, according to the Office for Budget Responsibility.