As affluent consumers in China and India demand a more Western style
diet we are seeing the effects on the price of meat and other foodstuffs.
During the past year UK Food price inflation has seen the price for Meat
rising by 5.4%, Fruit by 10.2% and Vegetables by 5.4%.
For 2014 the rate of food price inflation in the UK is forecast at 3.8%.
Food manufacturers are caught in a vice; the buying pattern for many continues
to be “just in time” reflecting the need to keep inventories as low as
possible.
However without the safeguard of a “buffer stock” they are now more than
ever exposed to the harsh reality of having to “pay up” in order to secure the
raw materials to keep their facilities in production.
At the same time suppliers will continue to face the problems of
operating in the current economic background with buyers seeking to delay
payment, renegotiate contracts etc.
The era of cheap food has long passed and with consumers still having to
closely watch their expenditure companies will now more than ever be required
to ensure they are operating at optimum efficiency.
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