This is the time of year when people usually have to head abroad in search of some hot and sunny weather – but not this year. Large parts of England have recorded less than 10mm of rainfall since 15 June, with northern Wales the first area to declare a drought.
The abnormally dry conditions have implications across the grocery industry. In fruit & veg, crop growth is slowing or entering a dormant stage, with Nationwide Produce also warning that irrigation is under increasing pressure, harvesting windows are becoming shorter and plants are under stress.
In meat, industry leaders are urging the government to prioritise farm and factory supplies against water company restrictions following the sudden closure of a 2 Sisters factory in Devon after South West Water imposed restrictions. And in grain, Northern Pasta Co has warned of an “unprecedented start” to this year’s harvest that is likely to have implications well beyond this year’s crop.
It’s not all bad news. Ice cream sales almost doubled year on year in June, rocketing 87.9% to £118.7m as average temperatures peaked at 26°C in the week to 27 June. One category’s heatwave is another’s drought.
Still, with temperatures only likely to keep rising due to the climate crisis, action is needed. Supermarkets are taking steps to increase domestic supply of certain products, including tomatoes, peppers and cucumbers, to head against global supply issues.
But a response will also need to come from government. New PM Andy Burnham has a long to-do list, covering everything from helping with the cost of living to boosting economic growth. Climate resilience and food security will need to be on the agenda as well – and are likely a high priority for Angela Eagle, the new environment secretary at Defra.
But while Burnham takes some time to figure out his 10-year plan, he has made some quick decisions that affect the food and drink industry. One of the announcements in his first week in office was to cut VAT for pubs, clubs and live music venues by 20%. It’s a welcome move, but it will need to be followed by more wholescale reviews of areas including business rates and NICs to really help the industry.
Pubs will take the win, but the rest of the high street is still waiting its turn.
Health of the nation
Away from the climate, health remains a critical item on the agenda. Our exclusive story revealed that government health advisors don’t think there is enough evidence for a new review on the dangers of UPFs and that the focus should be on HFSS foods.
And there is plenty of that, with the advertising watchdog publishing a new swathe of rulings on the junk food ad ban that saw an ad from McDonald’s cleared.
Plus, our analysis on former food tsar Henry Dimbleby’s new report on how to survive the “barbarians at the gate” in the form of weight-loss drugs and AI shows prioritising health is key.
In retail, rarely seen Worldpanel unit price data shows why Aldi is one of the fastest-growing supermarkets in volume sales despite being of the slowest-growing in value. It is the only one of the big six where average unit prices fell in the second quarter. The data is a blunt tool for price comparisons between retailers but does provide an indication of upward or downward price movement across all packs bought by shoppers from each supermarket.
A thirst for RTD
If there was any doubt of the insatiable thirst for RTD cocktails, Moth signalled its intentions to maintain soaring growth in UK retail as the brand secured a fresh £11m investment from private equity. The margarita-in-a-can maker is also looking to take flight in the US market.
Herbs and spices supplier McCormick gave London a vote of confidence as it announced the City as the place for its secondary stock listing as it pushes ahead with integrating the Unilever Foods business. It wasn’t the only food giant to make a splash this week as Nestlé struck a deal to sell a 50% stake in its waters business to Platinum Equity. The Kit Kat and Nescafé owner will be hoping the new joint venture is as successful as its private equity partnership in ice cream.
Elsewhere, shoppers’ appetite for East Asian flavours shows no sign of abating, as both our Focus On reports explore this week. Focus On Home Baking spotlights how shoppers are adding ingredients like matcha, miso and yuzu to their bakes. Yuzu is also cropping up in alcoholic drinks, as our Focus On Spirits & RTDs report outlines.
And from our low-key farm shop & deli strand, we meet Sylt Pickling, maker of pickling liquors and winner of a gold at William Reed’s Farm Shop & Deli Product Awards 2026. The brand’s founders talk of pickling everything “from fennel and fish to blackberries and pineapple”.
As ever, if you have any thoughts, questions or feedback on what we’re covering, we’d love to hear from you. You can email me at sarah.vizard@thegrocer.co.uk or reach out to any member of the team.
Enjoy the weekend when it comes.
No comments yet