The United Kingdom’s (UK’s) horticultural sector has gone through a number of major supply chain shocks in the last 18 months. These have included, of course, the COVID-19 pandemic —there isn’t a fresh produce business in the world that hasn’t been impacted in some way by this — and the decision to leave the European Union (EU) — our so-called Brexit.
One of the big impacts over the last 18 months (and many are beginning to think that COVID-19 has had far more of an impact than Brexit) is that the supply of labor into all stages of the fresh produce supply chain has been severely restricted.
This has caused severe problems and disruption at all stages of planting, picking, packing and distribution. The issue of labor is nothing new in the UK — there were reports being written about this topic as far back as 15 to 20 years ago. And the UK horticultural sector, like many others around the world, has been heavily reliant on the use of migrant labor.
Since Brexit, however, East Europeans have returned home, gone to work in other EU countries, or looked for better paid employment. We have also begun to see an increase in the rate of inflation as a result of rising fuel, labor and energy costs. This key performance indicator could reach 5% by the end of this year or early into 2022.
What has the reaction of this been in the UK fruit and vegetable sector? In short, there has been an explosion of interest in the new technologies that might help automate horticultural planting, picking, packing and distribution. In the past, many industry commentators in the UK have referred to what has been going on in the UK horticultural sector as a “defining moment in time.” This has sometimes not been proven to be the case.
Still, at the close of 2021, there is a feeling that, this time, the moment has now been reached. A combination of the impact of Brexit, COVID, the new UK trade deals being struck, the beginning of the reduction of support payments to farmers, the need for increased levels of sustainability and dramatic increases in input costs have all combined to produce something of a “perfect storm.”
There are a number of key factors we will see much more of in 2022. For example, we need to embrace the benefits of new technology in the horticultural sector in order to address the challenges that are being presented now, especially in the areas of labor – both its cost and availability. If we don’t find effective solutions to these challenges, there is a danger that some producers will simply just give up farming.
There is substantial funding available from such government organizations as Innovate UK and UK Research and Innovation to support this process. We need to change the image of the horticultural sector, and the use of new ways of working by using technology is one way of doing this and can inspire the next generation into the sector. There is a need to invest in areas such as skills development and training, too.
The recent United Nations Climate Change Conference (COP 26) discussions saw a further emphasis on the need to reduce the carbon footprint of horticultural production, not just in the UK, but also in other parts of the world, and over the duration of COP 26, agriculture and horticulture were increasingly in the limelight. The use of new technology in horticultural production is not the single silver bullet to address all the industry’s challenges, but it needs a collaborative approach from farmers, packers, processors, government, academia and trade associations to maximize the opportunities that clearly exist.
When it comes to investment in new technology, the intense nature of supply chain competition has, in the past, prevented some of the collaborative research and development that need to be undertaken. The sector is characterized by being based on high volume and low margin. But maybe by looking at the experience of the car sector, which has bought in high levels of robotics and automation, it shows what can be achieved over a period of time.
John Giles is a divisional director with Promar International, the consulting arm of Genus plc. He has worked in the past on horticultural and related projects in the UK, the rest of the EU, the U.S., Canada, Chile, South America, the Gulf, China, India, New Zealand and Australia.
