Fresh produce companies are growing increasingly nervous as trade credit insurers cut back on the cover they are prepared to offer.

Industry observers forecast this will lead to companies falling into the hands of receivers in 2009, with the catering sector at particular risk.

Sterling is almost at parity with the euro, and this is also adding to traders’ woes. “There have been major issues in Spain,” said one salads importer. “The volume just isn’t there and the first fruit has been sent to receptive markets in central and eastern Europe, where the deal is euro for euro. At this stage last year, we were looking at around €1.40 to the pound, which is a massive devaluation. It’s not just a problem in salads, every imported fresh product is experiencing the same issue.

“The supply chain wants more money, but it is not going to happen, and for an importer, that is a nightmare. We are all only as good as our growers - if they give you good product at a good price you are okay, but it cuts both ways and we are not finding it easy to keep our side of the bargain.”

Other importers report that the credit insurance situation is adding to the uncertainty. One said: “Trade credit insurers are cutting back on their limits quite considerably. Nor are they taking on any new business. We are all having to be very careful now about our total risk of exposure. Those that are luckiest are the ones with one or two very big customers.”

The situation is hitting exporters hard too. One UK sender to the continent said: “We have had our credit insurance on most companies we serve either completely removed or drastically reduced. We had one we work with at €200,000 (£180,000) go down to €45,000 and one firm in the Czech Republic we can’t get credit insurance for at all.”

A spokeswoman for global trade credit insurer Atradius insisted the company has not been singling out the fresh produce or food sectors in particular. She said: “We are trying to be as prudent as possible and stay on cover as much as we can. Our aim is always to keep trade going as far as possible and we are not reducing our cover on any one sector, but are working on a case-by-case basis. What may be happening in the fresh produce arena is that as trade credit insurers we are working on a ratings scale, and that is based on fixed assets as they come into play more in a volatile economic climate. But where a company has very low fixed assets, say in the buildings they own, and relies more on the trade they do as an asset, then their risk becomes higher.”

The Atradius spokeswoman said that catering companies “flagged up a question mark” in times of recession. She said: “Businesses will tend to cut back on their events and non-essential spending and catering is a part of that. Consumers also cut back on eating out, so that affects restaurants.”

However, she said that the food sector in general was “more robust” and while there are likely to be insolvencies in 2009, as an “essential” sector it is set to fare better than many others.