May News brief...
NORTHUMBRIAN FINE FOODS
BOUGHT OUT The management team at Northumbrian Fine Foods has purchased the biscuit manufacturing company with assistance from a number of long term investors. The transaction will allow the team to further grow the
Northumbrian Fine Foods business, invest in recruitment, new facilities and the development of new products.
MILK LINK
INCREASES MILK PRICE
Milk Link is to increase its member milk price from 1st April by 1.0 pence per litre (ppl) for both manufacturing and liquid schedules. The latest increase means that Milk Link’s standard litre member price for both manufacturing and liquid milk will now be 27.00ppl. The April rise means that over the last 12 months Milk Link has increased its member milk price by 3.75ppl for manufacturing and 3.53ppl for liquid.
FDF OPENS COMMUNITY PARTNERSHIP
AWARDS Food and drink manufacturers are invited to showcase their community and employment projects by entering the Food and Drink Federation (FDF) 2011 Community Partnership Awards (CPA). The CPA awards recognise the contribution and dedication shown by businesses to initiatives that make a positive difference – be it in their local community or to the natural environment via waste reduction schemes and other environmental initiatives.
Cost, cost, cost!
On-going price pressures force manufacturers to re-think pack sizes and ingredient choices
Food manufacturers are investigating pack, format and formulation options to tackle the on-going price pressures they face as a result of rising commodity costs, according to market researcher SPA Future Thinking.
A
djusting pack sizes, reviewing packaging formats and
reformulating existing foods with lower cost ingredients are three of the ways being explored by brand owners as they look to retain a competitive advantage. “We may be coming out of a two-year recession, but there is
increasing concern that shortages or price rises in commodities, coinciding with rising energy prices as well as demand in general, are going to impact on food prices at a global level in 2011,” said Andrew Tharme, managing director at SPA. “Shoppers are already feeling the impact of the long-term commodity price volatility across a wide range of products, from daily basics to their favourite confectionery items.” To alleviate this rising commodity pressure,
manufacturers have started to adopt smaller pack sizes where they believe consumers will no
longer buy into a specific product if there is a further price increase.
They are also reviewing packaging formats to cut production and/or transport costs. “For example, in the drinks industry, we are already seeing glass bottles being reduced in weight, the introduction of plastic bottles and a reduction in the weight of cans by brand owners,’” said Tharme.
Reformulating existing foods with lower cost ingredients is also a key consideration for manufacturers. “It’s an expensive and time-consuming route from a research and
Image courtesy of WRAP
RPC Group report ‘improved’ performance
In their pre-closing trading statement, RPC Group Plc, the rigid plastic packaging supplier, has reported an ‘improved’ performance. The company says
that it anticipates revenue in the financial year 2010/11 to be ‘well ahead’ of last year, as a result of higher selling prices and increased volumes sold. ‘Significant growth’ has been achieved, says the company, in their higher added value sectors, including pharmaceutical, personal care, long shelf-life and coffee capsules. However, RPC have said that there was a period where polymer price rises
of around 20 per cent were not passed on to customers, which will have a significant negative impact on full year margins. Also in the statement was an update on the acquisition of Superfos Industries, which, for €240 million, was completed on 18 February. Superfos’ trading performance in January and February is said to be better than the corresponding period last year and is ahead of
4 FMCG News
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