Three key predictions for the year ahead in food production and retail

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Nationalism, costs, scandals and "fake" claims: we list our three key predictions for the year ahead.

Prediction one: British produce will be more in demand and food inflation will be on the rise

In line with Brexit, the consumer consciousness will continue to move in a more nationalistic direction. Country of origin labelling will echo the current "Britain is best" sentiment. Voluntary labelling will become more prominent and associated insignia such as the "Red Tractor" logo are likely to become more prevalent. 

This year saw the National Farmers’ Union criticise certain major retailers for allegedly implying a misleading place of origin on their packaging. But consumers are also calling for greater sustainability, a shorter supply chain and better associated welfare standards. 

However, of overriding importance to the consumer remains price. Generally, ‘cost is king’ and as we have seen already, due to currency and cost increases, consumers will start to see a rise in food inflation for the first time in years. The key question will be going forward; who will bear the brunt of these cost increases; whether this will be the consumer at the check-out till, sucked up by the supermarkets or passed on to producers and farmers? 

As an aside, we await to see what increase in powers the Grocery Code Adjudicator (GCA) may get, if any, in 2017. In the meantime the results of the annual GCA survey is also awaited. 

Prediction two: There will be more scandals

2017 may be the year of inadequate supply and inferior food substitutions. Price will continue to be a decisive factor on consumer’s shopping lists, but currency fluctuations mean that food supply chains will come under increased pressure. "Marmitegate" and the subsequent debate about price increases will continue into 2017 as suppliers grapple with increasingly squeezed margins. 

Associated with price fluctuations will be vulnerabilities in the quality and consistency of foods. Producers will need to ensure they keep their product checks up to date and have good business continuity arrangements for secondary suppliers. Producers who are heavily reliant on agency workers will also need to ensure an adequate workforce is available to meet contractual obligations. 

Prediction three: "Super" food fads will continue

We will see an increasing "medicalization" of the food industry in 2017. The battle lines are being drawn up between so-called "super" foods often touted by celebrities – for example foods that can in some way lay claim to a "natural" claim, and those that might be deemed inferior – containing an added preservative, or with a higher level of fat, salt or sugar. 

The sugar tax for soft drinks was confirmed in the 2017 Budget but already the revenue forecast for the tax has gone down due to producers’ reformulation efforts. 

Consumers should be educated about diet as a whole, but this trend to individually categorise food looks set to continue, with the UK Obesity Strategy threatening to concentrate primarily on individual foods via advertising restrictions, reformulation and the sugar tax for soft drinks, rather than promoting education and personal responsibility. 

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