The Outlook for Food Crops – Procurement Issues and Problems Ahead?

Whilst it has moved down the headlines somewhat, the drought in parts of the USA – and extreme weather in other parts of the world – will have an effect on commodity and food prices for some time to come.

My own micro-commodity intelligence source (my vegetable patch) suggests that we’ve got problems to come in the UK later this year; here’s my crop review for 2012 to date.

  • Onions – disaster, almost total failure.
  • Potatoes – looked good early one but tops died very early, crop around half last year’s volume.
  • Courgettes – now doing OK but a month late, crop down overall.
  • Leeks – late, may still be OK by the winter but likely to be on the small side.
  • Kale and Spring Broccoli – behind schedule but could still recover.
  • Beans – ones started in pots OK, those planted direct into ground very poor.
  • Asparagus – what asparagus?
  • Fruit - the Blueberries have done surprisingly well, and the raspberries were OK if a bit late.

So overall, it has been a very difficult year – the worst in my 20 years plus of vegetable growing I think. The rain was so hard and consistent I believe it not only caused some plants to just give up the ghost, it also washed nutrients out of the soil – even since the weather improved, they’re not thriving as they should.

Of course, in the procurement world, we look at this from the point of view of the prices we will pay for  our raw materials, and hedging or other risk mitigation strategies.  If you buy edible raw materials, I’m sure you’re ahead of us on this already!

But we shouldn’t forget, that for billions of people around the world, this interaction of weather, land, crops and food is a matter of life or death, or at least hunger and struggle versus relative comfort. Digging up some of my potatoes last week, I was thinking - if this was a major part of how I was going to feed my family over the winter, we’d be looking at a hungry few months to come.

That’s not a cheerful thought for today’s August Bank Holiday in the UK, as the rain falls, and sports events and music festivals are cancelled. But next time we complain about the price of Broccoli in Sainsbury’s, (and expect high food price inflation in the months ahead), we might want to be thankful that, for those of us in the developed world, we’re not actually going to starve because of a crop failure.

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First Voice

  1. Andrew:

    This is a far bigger issue than many people realise and is also compounded by population growth. As you mention in the final paragraph, a macro level concern will be food price inflation. Given the proportion of household expenditure on food, rising prices has the potential to impact wider government policy – both in the UK and abroad – including interest rates and QE. This then has the potential to affect prices/costs for everything that we buy (goods and services). Expect problems ahead.

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