Catering


Volatile ingredient prices provide food for thought


allmanhall’s managing director Oliver Hall and procurement & sustainability director Mike Meek discuss the factors affecting global food supplies and prices and explain what care providers can do to weather the storm


Food inflation currently sits at three per cent and is forecast to rise to five per cent by the end of this year. The volatile pricing landscape has been caused by challenges in the supply chain, both at a global and local level. While there is turbulence, there are things that can be done and planned for, to ensure care caterers retain control, reduce their food costs, and make their catering budget go as far as possible.


The ongoing impact of climate change Changes in traditional weather patterns significantly affect crops and food systems. Extreme weather events, such as the droughts in California affecting citrus production, and shifts in growing seasons make it difficult to predict yields, contributing to price volatility. In the UK, we saw this variability with the 2019 cereal harvest, which was the highest this century, while the 2020 harvest was the second lowest.


Water scarcity is increasingly challenging in the South East and East of England, and poses a significant future risk to soft fruit production. Annual rainfall is well below the national average and agricultural hubs require significant water extraction for crop production alongside increased water consumption from densely populated urban areas. The year 2024 officially became the


first year to pass the 1.5°C global warming limit, and as we move further into 2025, extreme weather is likely to continue. We must accept that climate change will factor into food price increases over the coming months and years.


July 2025 www.thecarehomeenvironment.com


There are steps that can be taken to stretch budgets


The imposition of US trade tariffs In an increasingly globalised economy, domestic policies in one country can have unexpected ripple effects across the globe. While the UK exports a relatively small amount to the US, it might seem like a distant connection. But trade tensions involving the US can significantly disrupt global food supply chains, indirectly influencing the cost of food in the UK. There are several ways US tariffs can


affect UK food costs: Redirection of supply: when US demand for certain EU products decreases due to tariffs, European exporters may redirect their products to the UK. While this could temporarily increase supply and reduce prices, it could also create market distortions. UK producers may struggle to compete with a sudden influx of EU goods, potentially leading to long-term market instability.


Global commodity prices: if US soy exports to China drop due to Chinese retaliatory tariffs, other countries step in to fill the gap, causing prices to fluctuate. The UK, as a


net importer of many food commodities, is particularly vulnerable to these changes and to volatility in global pricing. Supply chain costs: trade disruptions can increase costs throughout the supply chain. For example, if certain inputs (like animal feed or packaging materials) become more expensive due to tariffs, the cost is eventually passed down to the consumer in the form of higher food prices. Currency volatility and inflation: tariffs can cause economic uncertainty, contributing to currency fluctuations. A weaker pound can make imported food more expensive, adding to UK food inflation. While the influence of US tariffs may not be immediately visible, it will inevitably be felt in the form of rising prices, limited product availability, or price fluctuations on certain imported foods. Products like olive oil, wine, cheese, and processed goods that rely on global supply chains are especially susceptible.


New procedures for European imports to the UK Moving closer to home, for those food suppliers importing goods from Europe and beyond, new border procedures bring additional customs checks for imported goods – increasing both time and cost for


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