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Oxford Farming Conference – ‘Is the food supply chain broken?’ report launched

Agri-TechE Article

A collaborative approach is needed to move the UK agri-food industry from “one that survives to one that thrives”.

This is one of the messages emerging from the report ‘Is the UK food supply chain broken?, launched at the Oxford Farming Conference 2024.

The report – which is based on interviews with 40 stakeholders from across the industry – recognises the role that innovation and risk-sharing has played in averting crises over recent years and has made a number of recommendations.

The authors conclude that instead of a ‘cheap food policy’ based on the assumption of abundant imports, future governments could leverage the strengths of the sector and the country’s natural capital and choose to champion UK-grown food for home consumption.

Long term agreements would support innovation

Agri-TechE Director of Communities Becky Dodds has reviewed the issues highlighted by the research and sees opportunities for agri-tech.

Becky comments: “Of particular interest were examples in the report where retailers had entered long term agreements with their suppliers to share risk through cost of production pricing models.

“It is vital, however, that these types of contracts do not penalise improved productivity. Instead, these collaborations could enable joint investment in approaches that will overcome intractable issues in the industry and improve sustainability for the longer term.”

Agri-TechE supports an innovation ecosystem that addresses real-world problems through innovation in technology, production methods and business models. It brings together farmers and growers with tech developers, researchers, and technical and commercial service providers, but greater involvement by the entire value chain would be a gamechanger.

However, despite significant progress being made in the development and adoption of agri-tech, scale-up is still an obstacle. Becky argues that retailers have much to benefit through greater support of emerging technologies.

She says: “Increased co-design and cost-sharing in the development of agri-tech would accelerate the development of commercially viable solutions and meet the needs of the whole supply chain.

“In this way the UK agri-food industry would move forward together, to become independently profitable.”

Review of the OFC report: ‘Is the UK food supply chain broken?’

The report ‘Is the UK food supply chain broken?’ observes the new business landscape of today’s supply chains – with volatility created by geopolitical challenges, unprecedented inflation, increased interest rates, climate change and the cost of living crisis. It recommends everyone responsible for feeding UK consumers to re-think their approach to supply chains before it is too late.

It then identifies a number of factors that have ‘broken’ the supply chain and makes recommendations for industry and policy:

  • Cost of production increasing – labour contributes 50% of costs, and wages increased by 28% between 2022-24. The supply of skilled workers has decreased with migration restrictions.
  • Input costs increasing – fertiliser prices increased by 77.7% from 2021 to 2022 (peak inflation was 200%). The last UK production plant has closed. Energy costs are similarly inflated.
  • Change in retail industry and contracts – the big four (Tesco, Asda, Sainsbury’s and Morrisons) have lost their share of the market (77.4% in 2011 to 64.4% in 2023) to newcomers Aldi and Lidl. This has resulted in a squeeze on margins and change in contracts to long-term fixed price.
  • Audit cost – the average financial cost of an audit is £2,000 – £2,500, and audits can take up to two days to complete. Some producers are audited almost weekly, with one producer saying they had received 190 audits in one year, many of them unannounced.

However, investment in innovation has improved productivity.

The report gives the example of soft fruit production, which has grown in value from £206m in 1996 to £1.5bn today. It credits this expansion to investment by the sector in innovations including varietal development, new growing techniques, and use of technology to extend the growing season from six weeks to six months.

Agri-tech can facilitate change

In many cases agri-tech is part of the solution and it offers potential to change the narrative. To illustrate the opportunities, we have highlighted a few projects from the ecosystem.

B-Hive has collaborated with nationwide potato supplier Branston Ltd and Harper Adams University to improve productivity in potato growing, harvesting and storage.

Precision livestock production – for example Breedr is enabling the production of ‘digital twins’ of real-world cattle that can be traded online, and tools to support more precise delivery to specification. This is improving the value of the contracts for suppliers and the consistency of supply for meat processors.

Price risk management – Stable uses data science to manage risk against price rises. Clients customise a contract to insure themselves against volatile prices and pay-outs are automated.

Beyond the comfort zone – REAP 2023 report captures the vibrancy of the day

Agri-TechE Article

“2023 has been quite a year in the farming industry,” observed John Barrett, Director of Sentry, and Chair of the Agri-TechE Stakeholder Group, as he opened the REAP Conference. “We started the year with wheat prices at a record high and have finished with wheat prices falling and crop input costs seemingly out of control.

“Such is the rollercoaster of farming, but our challenge is to try and take back some of that control and reduce those costs, by adapting our businesses and learning from others. This is very much the ethos of REAP.”

Rapid change has been a feature of the last five years, with far-reaching impacts on global agriculture and horticulture. The mood at the REAP conference was surprisingly buoyant as the agri-tech ecosystem came together to discuss emerging technology, science, and on-farm practices, that are providing opportunities for optimism.

We have attempted to capture some of that positivity in the REAP 2023 report.

REAP report 2023
Download REAP Report here or click image above

REAP Conference 2024 will take place on Wednesday 6 November in Newmarket.

Networking is a big element of REAP – it provides an opportunity for farmers and other end users to talk directly to technology developers and for others in the community to create collaborations and partnerships. Here are some comments from attendees and exhibitors:

“An outstanding REAP, consistent with the high standard of every Agri-TechE event. We were very happy to be part of the Exhibition and to engage with so many new people.

“The Innovation for a Sustainable Supply Chain was extremely valuable, as was the excellent Farmer Insights Panel and as always great to see new agritech companies in the Start-Up Showcase.”

“I had a great time at REAP, it was my first time attending the conference and was so pleased I was able to make it after lots of recommendations from my colleagues. I think the day was incredibly well organised and I really enjoyed the stalls whilst networking.”

I thoroughly enjoyed the REAP conference. I thought the content was very good quality, the structure of the day was good, with each session slightly different; I made a number of good links I shall be following up. Plenty of interesting people to talk with.

Agri-TechE Director Dr Belinda Clarke closed the conference by looking forward to the coming year, when the membership organisation celebrates its tenth year.

“Over the last ten years, significant developments in technology and changes in economics have increased the pull for more automation, changing the dynamics in cost-benefit analysis.

“As a result we are seeing rapid adoption of new technologies and approaches.

“The membership is also changing, becoming increasingly diverse and international, creating a supportive environment in which to scale and expand.

“We have had a record number of new members this year, and over the coming months we will be looking ahead and harnessing the thinking of the membership about the desired direction of travel.

“As the experiences of recent years have taught us, in order to build a productive, profitable, and sustainable agri-food industry, we must move away from the comfort zone and become open to the new opportunities that exist when we ‘stretch’.

“I am excited about the journey ahead.”

Rothamsted Enterprises
DIGITLab REAP 2023 sponsor
New Anglia LEP REAP 2023 Sponsor
RNAA - REAP sponsor
JA Kemp REAP 2023 sponsor
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