IGD - Economics bulletin 09 September

Date : 09 September 2021

Your overview of political and economic news with a focus on the food and consumer goods industry, featuring the latest developments and guidance on COVID-19 and adapting to a new relationship with the EU.

Labour availability – changes to HGV drivers testing

With an estimated shortfall of 100,000 HGV drivers, the UK Government is expected to announce a plan to shorten the testing process for HGV drivers. The Government’s proposals, which are yet to be confirmed, are thought to include combining the Class C test used for rigid lorries and Class E for articulated lorries into a single test. This would expedite the testing process.

DEFRA is keeping under review absence levels in all parts of the food supply chain and is requesting businesses complete this absence tracking survey as frequently as possible.

Shopper availability concerns decline

Although absence rates relating to COVID-19 are thought to be falling, broader operational labour and HGV driver shortages are continuing to create challenges for supply chains.

This is resulting in lower order fulfilment levels than normal, meaning there is an impact on availability of some food and groceries.

Shopper research conducted for IGD over the weekend of 3-5 September reveals a decline in the number of adults (56%) who experienced shortages of some food and groceries in-store or online recently, down from last weekend (62%).

Fewer adults (33%) have recently felt the need to stock up or purchase more than they normally do, down from 38% last weekend.

See the full results here.

Despite the operational challenges due to labour shortages, there are sufficient food supplies within the system and any impact on overall availability has been limited to date.

Shopper confidence impacted by inflation concerns

Latest research from IGD’s shopper confidence index reveals that shopper confidence has slipped back slightly to -4 in August, having declined for three of the last four months. However, it remains relatively high and is still at one of the highest levels in the last five years. 79% of shoppers expect food prices to get more expensive next year, compared to 75% in July’21. Full details are available here for ShopperVista subscribers.

Northern Ireland Protocol grace period extension

The government has announced a further indefinite extension of the grace period for sending certain Prohibited & Restricted goods (P&Rs) from GB to NI. This was due to end on 30 September. The EU responded by stating that “The Commission continues to engage constructively with the UK, in the interest of all communities in Northern Ireland”. However, it has ruled out any renegotiation of the Northern Ireland Protocol.

1 October – Preparing for changes to imports of products of animal origin

From 1 October products of animal origin and all regulated plants and plant products will require pre-notification and health documentation to be imported into the UK.

Between 1 October and 31 December 2021, businesses can self-apply the derogation for pre-notification of consignments into Great Britain. Businesses will be able to take advantage of the derogation and notify no less than four hours in advance of arrival at the port of entry, without any need to contact the relevant competent authority.

Read our latest article - The UK border – What you need to know about the incoming changes for EU goods

See the Key dates for UK-EU transition and support for businesses

See the webinar calendar for organisations that trade with the EU including the Border and Protocol Delivery Group (BPDG) Industry Day Programme 202.

Register here for a series of webinars with panel of experts and see the guidance on trade with the UK as a business based in the EU.

Plastic waste consultation

The Government has announced plans for a consultation on banning single-use plastic plates, cutlery, and polystyrene cups. Further details of the consultation, including the full list of single-use items under review, will be confirmed in the upcoming weeks.

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