The economic downturn could present an “ideal opportunity” for UK growers, as reports emerge that importers are suffering severely from a 20 per cent price hike on imports from Eurozone countries.
Growers on the continent have been recording huge trading losses because of sterling’s slump and are putting up their prices for the UK market to compensate - or are bypassing it altogether in favour of their neighbours who have been immune from the slip.
Sterling has lost almost a fifth of its value against the euro in the last few weeks, causing huge problems for importers - meaning that retailers such as Tesco and Sainsbury’s will be obliged to raise prices in order to achieve supply security.
John Smith, chairman of mushroom marketer Greyfriars, believes UK independent suppliers could capitalise on the conditions. He said: “There is a huge impact on imported cost and really, it is an ideal opportunity to wave the self-sufficiency flag.
“Unfortunately, we are not able to do this quickly - you can’t just turn on that investment. To make matters worse, a lot of horticulture equipment is manufactured in the Netherlands and elsewhere in Europe, so the cost of that will be affected adversely too.
“But we are taking the long view. There is an understanding that we want local supplies and since banks have been enthusiastically indifferent to lending for investment, we are looking at high net-worth investors as alternatives.
“Some have already expressed an interest in relatively low-risk ventures, because people need food and, frankly, where else can they invest? With inflation running at 3.9 per cent, free funds can only depreciate.”
Smith added: “There can be no doubt at all that with such a collapse in sterling, the impact will be felt at retail price levels.
“A large number of Eurozone countries export to the UK and do not make the margins to be able to absorb a 15-20 per cent fall.”
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