The events of 2020 presented everyone with new and unique challenges and the Foodservice industry was no different. As a result and as we move through the beginning of 2021 we are seeing these challenges being reflected in prices as the market shifts.
Pricing has reduced due to a lower foodservice demand and high stocks. The Seasonal crop was particularly high and total potato production in Northern European countries is estimated at 27.93 million tonnes an increase of 3.9% year on year and 7% higher than the 5 year average.
Bacon and Gammon:
Reduced demand from Asia has added to the supply surplus in European markets.
Reduced trade for fillets has helped and improved pricing, however shortages of fish mince is impacting processed lines such as fish fingers and prices here are increasing.
Milk & Cheese:
Prices are rising due to strong retail demand and seasonal supply reductions plus exports for cheese remain high. Increases on feed prices are also likely to contribute to higher milk production costs and as such higher milk prices.
Avian Flu and high retail demand has pushed pricing upwards. Defra stats has shown that the average farm gate price is at its highest level in 4 years.
Strong demand for mince throughout the summer and the resulting carcass imbalance has pushed beef prices upwards.
Bread and Flour:
A very poor European harvest combined with a high demand has led to price inflation.
Rice and Pasta:
Strong demand and availability issues led to a price spike in 2020. Lack of shipping containers has meant that in some instances Indian ships have had to wait for up to 4 weeks to load rice. Durum wheat, the main ingredient in pasta represents only 5-8% of global wheat production and so is more susceptible to price fluctuation than the overall wheat price. The pandemic saw consumers filling cupboards meaning demand outstripped supply.
A tightening global supply position has led to prices rising
The demand for healthy products during the pandemic has led to inflated prices. For oranges spot prices are peaking at 15% above their January or start of the year level. This coupled with orange juice production being down 23% year on year, due to a reduction in Brazilian output, has contributed to this inflation.