April 25, 2024

UK Supermarkets Face Fresh Produce Shortage, Causing Sales Decline & Restricted Purchases

UK Supermarkets Low On Fresh Produce

In recent weeks, UK supermarkets have been facing challenges with the availability of fresh produce, which has significantly impacted sales. The shortage has affected key salad ingredients, including tomatoes, cucumbers, and other staples.

The shortage can be attributed to various factors, including harvest disruptions in North Africa and Southern Europe due to unseasonal weather patterns. It has made it difficult for suppliers to source the quantities of fresh produce needed to meet the high demand in the UK. In addition, there has been a slowdown in greenhouse activity due to high energy costs, further contributing to the shortage.

In response to the shortage of fresh produce, several UK supermarkets, including Tesco, Aldi, Lidl, and Morrisons, have imposed limits on the purchase of salad items per customer. Customers are now restricted to buying one item at a time, as the government warns that the shortage may continue until early April.

Fresh Produce Shortage Leads to Decreased Unit Sales

The restrictions come as a market research firm, NIQ, reports that the total volume in the fresh produce category saw a small increase of just 1.1% over four weeks, following a decline of 5.4%. The research group notes that supermarkets failed to meet the demand for items such as tomatoes, with unit sales falling by 17.6%, while unit sales for peppers declined by 16.8% in the same period.

Despite the limited availability of fresh produce, the value sales of lettuce and cucumbers have increased by 13.7% and 30%, respectively. According to NIQ, gross grocery sales saw an uptick of 11.1% in the last four weeks of February, which has helped mask the drops in volume, putting it at 14.5% when including inflation.

Research firm Kantar notes that Aldi and Lidl are not seeing a slowdown in market share but rather an increase. Aldi has gained 25.6%, while Lidl has gained 21.1% in the last four months. This uptick is largely due to the opening of new stores, which has helped these retailers attract more customers.

In addition to the increase in market share for Aldi and Lidl, Kantar notes that Tesco shares were up 8.7%, beating Sainsbury’s 8.1%. Asda saw a rise of 7.8%, while Morrisons was the lowest gainer of the day at 0.5%. The online shares of the grocery market saw an 11% downturn from the same time last year, where the figure was 12.4%.

Overall, the adverse weather conditions in the southern hemisphere are starting to cause ripples in the market as food shortages become more pronounced. Moreover, the impact of these shortages is likely to be felt for several more weeks, which could lead to more disruptions in the fresh produce supply chain and higher prices for fresh produce.

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