How can we ‘build back better’ and what’s the role of plant-based diets?

 

By Prof. Michael Winter

In July 2020, the UK Global Food Security Programme and the Biotechnology and Biological Sciences Research Council hosted a workshop with a range of stakeholders from across the UK food system. The workshop sought to determine the research and innovation needs and opportunities around ‘building back better’ through Covid, and how this might enhance the resilience of the UK food system to future shocks. I was one of the 54 on-line attendees, as were Expert Panel members Barbra Bray and Caroline Drummond. A report summarising the discussion is now available: Building back better for increased resilience of the UK food system to future shocks (2020). Workshop Report.

The Executive Summary highlighted the key findings as follows:

  • From an agricultural perspective, research into improving the UK’s soil health is crucial, alongside the development of enhanced climate models. Measures to address the UK’s ageing farmer base are also identified as important.
  • Local food production is a useful supplement to globalised supply and demand, alongside improved data sharing within supply chains and a greater ability of producers and manufacturers to ‘re-pivot’ their activities in a disruption scenario.
  • Expansion of plant-based protein and fruit and vegetable production in the UK through enhanced inter- and intra-crop species diversification is important, not only to reduce risk from disruption to supply but also to better ensure the UK can meet its nutritional needs in any future disruption scenario.
  • Understand the complex range of factors influencing nutrient uptake and consumer dietary choices and the potential for enhancing the nutritional value of foods. This is alongside the role of diet in COVID-19 related deaths and an underpinning need to improve overall dietary health.
  • At a supply chain level, there is a need to identify ways to buffer just-in-time systems against food shortages. Solutions should focus on adaptability, for example, by utilising emerging technologies, such as digital twins, which can help different supply chain actors react to a disruption in concert rather than isolation.
  • In order to facilitate a more resilient UK food system, stakeholders are clear that research and innovation needs to be interdisciplinary and international and that applied research must be adequately funded.
  • It is essential that any research and development opportunities are systemic. If implemented in a piecemeal fashion, resilience will not necessarily ensure that food is affordable, accessible, safe, healthy and produced in a way that underpins, and benefits from, a thriving natural environment. These areas must therefore be consciously enshrined in designs for food system resilience.

 

The prominence given to dietary change and plant-based foods is unsurprising, but I was interested to think about this in the context of the findings of the Peoples’ Climate Vote published on the 26th January 2021.

The People’s Climate Vote was based on 1.2 million respondents (although only 35% answered the policy questions I refer to below), spanning 50 countries, including the UK, and covering 56% of the world’s population. The survey identified six policy areas (energy, economy, transportation, farms and food, protecting people, and nature) each with three sub-options – giving a total of 18 policy possibilities. On average, respondents backed eight out of the 18 climate policies, and 97% supported at least one policy. The most popular of the 18 policy options, supported by 54% of respondents, was to conserve forests and land, while the least popular (35%) was the promotion of plant based diets. Of course, most reading this will immediately point to the fact that to conserve land requires dietary change: True! And others might suggest that the results would be different in countries such as the UK: possibly, but plant based diets did not make it in the top ten policy option preferences for high income countries, including the UK (there is no data for individual countries presented in the report).

What do I conclude from this? Well two things to stimulate thought and perhaps some debate:

  1. Dietary choice is deep wired in people’s identity and selfhood, and even events as grave as the climate change emergency will not shift people’s thinking on food easily or quickly.
  2. Those promoting a very rapid transition in agriculture to organic or, so-called, agro-ecological systems, predicate their arguments on a significant reduction in animal-based food.

The tensions between these two observations are obvious. What is less clear is how such tensions are resolved. Maybe the forthcoming National Food Strategy will give some clear guidance on the balance between regulatory, market and behaviour changes that might be needed to secure both food and environmental security. One thing clear to me is that farming is largely in responsive mode in this debate. Farmers have the skills to manage the land and produce commodities, but precisely which commodities, and at what volume, is inevitably an outcome of markets and regulation. In other words, to end on a provocative note, promoting a wholesale transition to organic farming in advance of a clear sense of how food markets might change, seems rather curious. Farmers will respond to market and policy signals but what these will be, as we attempt to build back a better food system post-COVID, it’s too early to say. This is not to suggest that farmers and other players in the food system are merely passive. They are also players in the development of markets and regulations.

The Footballer and Food

 

By Prof. Michael Winter

I don’t often watch football. I used to enjoy playing but that was many years ago and somehow I just much prefer watching rugby these days, maybe because that’s a sport I never did play.  Be that as it may, on Sunday evening I did tune into BBC 1 and watch Manchester United take on Liverpool in the fourth round of the FA Cup.  And I was prompted to do so in part because I wanted to see Marcus Rashford MBE.  He did not disappoint, scoring one goal and making another with a superb pass. He is some player for sure. He is also perhaps the most prominent celebrity name in the Covid food story, leading fund raising efforts to support children in poverty with food; and at the same time taking on the Government over free school meals, most recently successfully challenging the quality of some food parcels.  In this respect, Rashford is following in the footsteps of other celebrities, notably Jamie Oliver who, as long ago as 2006, highlighted quality issues with regard to school canteens.  Back then, it was the Compass Group under fire and it so happens that the miscreant highlighted by Rashford over food parcels was Chartwells, a subsidiary of Compass.  Compass Group plc may not be a well-known name but they are a FTSE 100 company and a global player in catering.  As the Guardian points out:

Catering services are typically fragmented between many small providers, but Compass has profited from being one of the few catering companies with global scale and 550,000 employees. … The pandemic has also dented Compass’s profits as canteens in offices, hospitals and military bases have remained shut around the world. Compass’s earnings before tax fell by 85% in the year to 30 September 2020 to £210m.’[1]

There can be no doubt that the food parcel that caused such offence was sub-standard – the photograph went viral and does not need reproducing here – but I have just a little sympathy for companies, big or small, trying to adapt to fast changing policy demands.

I remember some academic colleagues back at the start of the pandemic writing to the Prime Minister suggesting that food rationing should be introduced, which I interpreted as headline- grabbing shorthand for more controls and a clear strategic policy within the food system. To me, and I would welcome feedback on this, the Marcus Rashford story highlights a failure of strategy within the inevitable policy intervention in the food system during this crisis.  We have a situation where Government has intervened massively in the economy to an extent unprecedented since the Second World War, but neither the institutional architecture nor the nature of the policy deliberation process comes anywhere near what was put in place around the food system in 1940.  And it was a very sophisticated, perhaps overly bureaucratic, set of interventions which certainly involved the farming and food industries directly in shaping and implementing policy.

I can’t resist just finishing on a footballing note. The football league was, of course, suspended from 1940 to 1945 but in the first season of its resumption in 1946/47 the champions were none other Liverpool and the runners up Manchester United!  Plus ça change!

 

[1] https://www.theguardian.com/business/2021/jan/12/school-dinners-row-shines-light-on-role-of-catering-firms-chartwells-compass

 

Covid Food Business Barometer – summary of results from a short survey in late 2020

 

By Tim Wilkinson and Matt Lobley

We have been casting our minds back to November 2020. It feels like a long time ago now. A lot has changed; and while analysing some data we collected at the end of last year, we have been thinking about just how much. This week we are presenting some headline results from our Covid Food Business Barometer survey. We think the results help remind us that although the business outlook is currently gloomy, some businesses last year were feeling well adapted to working within the Covid restrictions and were confident about their future.

 

Should We Run a Survey?

In the end, we ran a short survey at the end of November last year for food businesses. But we were in two minds about whether to run it at all. We were worried that it might not be an appropriate time to be doing research given the challenges that food businesses were facing. We had designed a longer survey that was due to launch just as Lockdown 2 was announced. After much deliberation and consultation we decided to redesign a shorter survey – to minimise the time it would take businesses to respond. The survey was open for two weeks from 27th November to 12 Dec 2020. This period ran across the lifting of Lockdown 2 restrictions on 2nd December 2020 and into revised tiered restrictions. We received 87 responses, to a 12-question survey, which took respondents about 6 minutes to complete. We circulated the survey online via industry mailing lists and on Twitter (we had few responses from Twitter). About two thirds of responses came on the 30th November and 1st December – just before Lockdown 2 was lifted.

We think that the pressures on businesses and changing lockdown restrictions probably affected response rates, however we are pleased to have taken a snapshot of how some businesses were doing during this crisis. Due to the small sample size, the results should not be taken as representative of all food businesses. Indeed, the sample is quite likely to be biased towards businesses who felt they were well adapted to working within Covid restrictions and who were not facing major challenges. Nevertheless, the results tell an interesting story about how businesses who responded to the survey were feeling late last year. The results also give a sense of the scale of economic impacts that Covid has had on businesses.

Businesses who responded to the survey were from a wide range of food sectors and stages of the supply chain. We had responses from Bakery (11%), Meat (11%), Beverages (11%), Ready to Eat Meals (10%), Technical Services (7%), Consultancy Services (6%), Confectionary (5%), Fruit and Vegetables (5%, Grain and Starch (5%) and several more. The Fish and Seafood (3%) sector was not well represented in the sample so the results do not tell us much about that sector. In terms of supply chain stages, we had responses from food processing (11%), food manufacture (22%), wholesale and distribution (17%), import and export (11%), retail (11%), hospitality and food service (9%), consultancy services (11%). No one sector or supply chain stage seemed to be strongly over represented.

 

Feeling Well Adapted and Positive About 2021

Most businesses (77%) which responded to the survey were fully open and trading, but some were only partly open (20%), particularly in hospitality and food service, retail and manufacture. Just 2% of respondents were from businesses that were closed. Most respondents (82%) said that they were facing challenges but coping, while 15% said they were doing well. Only 3% of respondents were facing major difficulties. Perhaps this bias towards businesses not facing major difficulties explains why 85% of businesses said they had adapted well to working within the Covid restrictions, and why 67% said they felt confident about the future of the business. This was a very positive message, which was reiterated by businesses who, overall, scored themselves as well prepared for Lockdown 2 and for future Covid related restrictions. On a scale of 1 to 10 (where 1 was not at all prepared and 10 was extremely prepared), the mean score for being prepared for Lockdown 2 was 7.5 and for preparedness for future restrictions the average score was  7.4. This high level of preparedness is reinforced by a small majority of respondents (54%) saying that Brexit was a bigger threat to the business than Covid-19. We think that in late 2020, contingency planning may have shifted from ‘Covid’ to ‘Brexit’, with the acute uncertainties around the deal at that time. For some businesses there may have been a sense in which they were as prepared for Covid as they could be, and that the more pressing issue was how to prepare for Brexit.

 

Table 1. Results of Attitudinal Questions   

Disagree Neither Agree
I think the business has adapted well to the challenges of working within Covid restrictions 9% 6% 85%
I am feeling confident about the future of the business 9% 23% 67%
Brexit poses a bigger threat to our business than Covid-19 22% 24% 54%

 Source: CRPR Food Business Barometer Survey

 

We think that these results show how positive and well adapted some businesses were feeling late last year. As we’ve said, these results aren’t representative of all food businesses and this was a small sample, but nevertheless it shows how some food businesses have been able to adapt to meet the challenges of new ways of working in the pandemic. We do wonder whether this positive outlook was coloured by the imminent lifting of the Lockdown 2 restrictions and perhaps a wider societal hope that the pandemic would abate in early 2021. Furthermore, November 2020 saw the US presidential elections outcome, financial markets recovering and, when we ran the survey, it was far enough away from Christmas that it was still something to look forward to. We don’t want to under emphasise the pressures and challenges that food businesses face – or the work they have put into adapting to Covid, but our results indicate that some businesses do have moments of positivity and confidence. With the benefit of hindsight, we think it’s likely that the last minute announcements of tier changes over Christmas and subsequent Lockdown 3 will have changed the business mood. It certainly feels that way and elsewhere in this bulletin Michael Winter highlights some of the recent pressures facing the wholesale sector.  But what we can learn from these results is that, while there are serious business challenges, there is also adaptation and confidence. The swing from feeling prepared to feeling unprepared can be very quick, but we shouldn’t forget the times when businesses feel able to cope with the rapidly changing world. It’s not easy to get prepared or to adapt. It’s an achievement and should be acknowledged.

 

Economic Impacts

We asked several questions about how sales volume, turnover and profit have changed; how much they had changed over last six months (compared to pre-Covid) and how much they were expected to change over the next six months (compared to the last six months) on a scale from -100% to +100%. Please note that below we are only presenting the raw means, which includes outliers. On average sales volume (-20%) and turnover (-21%) were down about a fifth over the last six months, with an expected increase in both of 6% over the next six months. Profits were down, on average, by 30% with little change expected in the next six months. These averages won’t tell an accurate story for particular sectors; they are just an average across the whole sample. But we can see in our analysis, for instance, that a large proportion of those businesses whose sales volumes reduced the most (from -100% to -40%) were in hospitality and food service, and those whose sales volumes increased the most (from 0 to +80% increase) comprised of a large proportion of food manufacturing business. Covid has had an uneven impact on different sectors. But in the context of the overall figures for changes and expected changes in sales volumes, turnover and profit, the positive response to questions about adaptation, confidence and preparedness, are perhaps even more striking – given the likely consequences of these economic impacts on cash flow and savings.

 

Table 2. Results of Economic Impacts of Covid Questions  

How much have…changed in last 6 months compared to pre-Covid % (mean) How much do you expect…to change in the next 6 months compared to the last 6 months % (mean)
Sales volume -19.9 +5.8
Turnover -20.7 +5.6
Profit -29.6 -0.9

Source: CRPR Food Business Barometer Survey

 

Part of the reason for these economic impacts is business closure during lockdown and workforce issues, but it is also the costs of implementing Covid safe measures. Businesses responding to our survey experienced an average 10% increase in operating costs due to implementing Covid safe measures and a reduction in profit of 7%. We wonder what proportion of the increased operating costs are now fixed costs built into the system, and what proportion will be ongoing.

 

Where Next?

We know that the business attitudes and perceptions about the future will have been revised with the announcement of Lockdown 3 and the impact that changes to Christmas restrictions had on customer demand for some businesses, so we are planning the launch of a follow up survey in March. While the mood and outlook feel very gloomy at the moment, it remains possible that we may move quickly back to something more positive later in the year – or not, as the case may be. In this dynamic and uncertain situation it is easy to start to think that the last year has had little positive in it. But we think that the results of our short survey show the adaptability of businesses and their resilience in seeing a future for their businesses – despite the heavy economic burdens that the pandemic has placed on them.

 

A Note on Percentages Stated

In this blog we have only reported headline findings; percentages listed may exclude categories where responses were small or in ‘other’ categories. For this reasons they may not sum to 100%. Percentage has also been rounded to the nearest whole number. For more information on the results, please contact .

The Plight of Wholesalers

 

By Prof. Michael Winter

I suppose it is hardly surprising that most media attention on food throughout the panic has tended to focus predominantly on the retail and hospitality sectors. After all, that is where millions of people have felt the changes in our food system most keenly. However, at our January Expert Panel meeting, attention was drawn to the plight of wholesalers, especially with regard to the speed with which the rules on lockdown restrictions changed in early January. To be specific, the Government maintained ‘a back to school come what may’ policy until, that is, they suddenly dropped it! Let James Bielby the Chief Executive of the Federation of Wholesale Distributors take up the story:

‘Before Christmas, the government were adamant schools would stay open on the basis they were low risk. Schools placed orders for food from their wholesale partners in preparation before going off on two weeks’ holiday. Stock was ordered in accordingly by wholesalers ready for shipment in January. … Then the new lockdown was announced by Boris Johnson, taking effect at midnight on 5 January. Schools closed, hospitality largely shut down. Remember, we had Brexit stockpile, Christmas stock which was impossible to sell and now orders placed for and by education. All of that stock suddenly redundant. How much? £12 million of excess stock, all of it created by misinformation and planning failure by the government. Schools sent back orders placed before Christmas. The treasury announced a support package, but of course there was nothing for wholesale.’ [1]

These are hard-hitting words. I am told that the number of pupils in school, due to a broadening of the definition of essential workers, is greater during this lockdown. I telephoned the Norse Group, the largest commercial Local Authority Trading Company in the UK, responsible for supplying many schools, and they assured me that they were still providing schools with food though, of course, at reduced levels.  It is not clear whether the £12m excess stock referred to in the Wholesale News on the 14th January factors in some continuing supply of school or not.  Perhaps someone reading this can provide us with more detail.  These comments are not in any way designed to detract from the central thrust of the wholesalers’ concerns. In any case, this is far from the end of the wholesalers’ complaints.  In addition to the surplus stock issue, there is the issue of free school meal packs ‘which were keeping wholesalers afloat in the absence of any government support’. Criticism of the quality of some of these packs led to another media feeding frenzy:

‘… the government did another U-turn today (14 January) and changed the Department for Education guidance on free school meals and reintroduced the voucher scheme. Government by headline. No strategy or consistency. Just following the news, not leading it. … There’s a lot more excess stock in wholesale now, after schools cancelled the food parcels in their droves. Supply orders have been made by wholesalers for the next few weeks to supply FSM. … And where can the vouchers be redeemed? Supermarkets! That’s the biggest irony of all. The government has today handed wholesale trade directly to the supermarkets – just to chase a headline.’ [2]

 So this is much more than just a story about losers within the food system as a result of pandemic restrictions, it is also about shifts of power and market share within supply chains.  The boundaries between different players in the food chain are being disrupted and blurred. Not all of this churn derives solely from the pandemic. For example, some supermarkets had already moved into the wholesale sector, with so-called hybrid wholesalers, the Co-op and Morrison’s, growing their market share within wholesale from 6.5% in 2018 to 9.2% in 2020:

‘The Co-op provides wholesale services to the fifteen independent regional co-operative societies, as well as to Nisa and Costcutter – in addition to its own retail estate. Meanwhile, Morrison’s supplies Amazon and McColl’s. Lumina Intelligence estimates that both operators will see wholesale turnover increase by around 15% in 2020.’ [3]

And, of course, those more traditional wholesalers supplying retail have seen increased demand whilst those focussing on hospitality and catering for institutions such as schools are really suffering.  Some wholesalers have offset losses by finding new routes to market:

‘JJ Foodservice launched JJ Home in July 2020, signalling the permanent addition of its DTC (Direct to Consumer) service – initially introduced as a stop gap – to the wholesaler’s portfolio. JJ’s has also invested in smaller delivery vans to negotiate tighter London streets and most recently has launched a “Christmas at Home Essentials range” for its consumer customers.  Similarly, Bidfood has formalised its DTC business “Bidfood at Home” and has plans for national roll out. Meanwhile, Brakes has launched its “Food Shop” venture which has been selling direct to consumer since March 2020.’ [4]

The fact that some wholesalers have come up with innovative partial solutions, to the challenges they face is not surprising. It is equally unsurprising that some have been unable to do so, given the heterogeneity of the sector.  The fact that wholesalers are not included in this year’s hospitality support measures suggests the Government does not grasp the diversity of the sector either, nor its importance in a system that, despite initial fears, has largely maintained food supplies during the pandemic. It is hard to avoid a sense that a rather crude politics is at play here. Most food wholesalers are not household names in the way that major retailers and hospitality brands are and their pleas do not easily find ready media coverage. And if this appears to be a criticism only of government let me finish by turning the spotlight on my own sector of academia.  The Web of Science is one of the leading on-line bibliographic indexes covering academic publications from across the world. I did a search for all publications with the words ‘food’ and ‘wholesale’ in the title over the last twenty years. The search came up with 27 ‘hits’. Substituting ‘retail’ for ‘wholesale’ gave 842 publications. For not the first time in this project I find myself wondering why so much public, policy and scientific attention is given to food production (farming) and to food retail (consumption), but so very little to the complex system that ties these two together.

 

[1] Bielby: ‘Government by headline’ twists the knife in wholesalers’ backs – FWD

[2] ibid

[3] Growth In Wholesale Sector Slows As Pandemic Leads To Polarisation And Change | KamCity

[4] ibid