Red Sea attacks: Issues for tea availability

Houthi militia attacks on shipping in the Red Sea have led to a sharp decline in the number of ships transiting the Suez Canal. Ships have been rerouted around the Cape of Good Hope adding journey time and cost. The cost of global freight has also jumped sharply.

With modern supply chains relying on frequent and timely deliveries, any impact on shipping can have a detrimental impact on availability.

Events in the Red Sea region seem unlikely to impact food security in the UK significantly, in the short-term. The volume of food goods coming via the Suez Canal is likely to be fairly minor overall, although important in some categories (e.g. tea, coconut milk, exotic fruits, spices). See our full analysis.

In the latest consumer research conducted for IGD (16-18 February 2024), half of adults (49%) experienced poorer availability of some food and groceries in-store or online recently. Compare that with a high of 77% in March 2023 when extreme weather conditions in Spain and north Africa affected harvests resulting in some supermarkets introducing limits on some fruit and vegetables.

Around half of tea consumed in the UK arrives via the Red Sea. This has led to some supply issues in some stores. The British Retail Consortium has said, “There is temporary disruption to some black tea lines, but the impact on consumers will be minimal as retailers are not expecting significant challenges.”

Our latest consumer research reveals that 1 in 10 consumers have reported poorer availability of tea. That represents double the level from last month (9% vs 5%). However, this is relatively low compared to 52% reporting availability issues for fresh produce in March 2023.

Availability concerns have remained relatively stable for other categories.

Availability concerns by region

Availability issues for tea are highest in the South West (15%). Consumers in Northern Ireland continue to report poorer availability at an overall level (70%).

From 31 January 2024, the Target Operating Model (TOM) was implemented. Checks on imports of medium-risk animal products, plants, plant products and high-risk food and feed of non-animal origin from the EU commenced. Pre-notification requirements for low-risk plants and plant products are being removed.

IGD Viewpoint

Just-in-time delivery leaves little room to accommodate supply chain shocks. Disruption to trade due to geo-political issues will continue to impact availability and prices.

This is bound to have some impact on the UK economy and on UK consumers, although probably quite unclear and hard to measure, occurring over multiple categories.

This highlights a need for investment to increase resilience. See our report on Rebuilding economic resilience in the UK food supply chain.