Nestle quality street lorry

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Nestlé has warned over potential supply problems ahead of the key Christmas period after being dragged into the ongoing crisis hitting all areas of the food industry.

The world’s largest food producer told the BBC it was “working hard” to ensure its products, including the festive favourite Quality Street, are available on supermarket shelves over the winter.

The Swiss group also makes the likes of Aero, Smarties and Lion in the confectionery category.

CEO Mark Schneider told the broadcaster: “Like other businesses, we are seeing some labour shortages and some transportation issues but it’s our UK team’s top priority to work constructively with retailers to supply them.”

When asked whether he could guarantee Quality Street would be in the shops this Christmas he added: “We are working hard.”

It is the latest company in the sector to be hit by myriad problems in the supply chain, including a widespread shortage of HGV drivers, a general shortage of labour and delays to global shipping.

Yesterday, The Grocer reported that farmers had been forced to start culling healthy pigs backlogged on farms as the meat industry struggles with the labour crisis.

The dairy sector has also been hit as the lack of lorry drivers led to farmers pouring thousands of litres of milk away.

Last month, Tesco executives alerted the government of worries that panic-buying in the run-up to Christmas could potentially be ‘far worse’ than during the early stages of the Covid pandemic.

Supermarkets such as Aldi and Iceland have already seen a big uptick in demand for frozen turkey crowns and other Christmas items.

Morning update

Elsewhere, it was a quiet morning on the markets with no company updates.

The FTSE 100 bounced back from yesterday’s declines to rise 1% to 7,063pts in the early going.

THG continued to make a recovery, climbing another 3.8% to 451.2p this morning, while other risers included Britvic, up 2% to 903p, Tesco, up 1.8% to 272.8p, and Deliveroo, up 1.5% to 273.2p.

Early fallers included McColl’s Retail Group, AG Barr and Finsbury Food Group, down 1.7% to 20.2p, 1.1% to 527p, and 0.5% to 93.1p respectively.

Yesterday in the City

The FTSE 100 took a knock yesterday as soaring oil prices led investors to sell, with London’s leading index falling back below 7,000pts, down 1.2% to 6,995.87pts.

Tesco escaped the negative sentiment to continue a good week for the supermarket. Shares soared 5.9% to 267.9p after the group lifted its profit expectation on the back of rising first-half sales.

Rival Sainsbury’s slipped back 2.9% to 290.7p as investors took a profit from big gains earlier in the week. Speculation is swirling around the supermarket with Fortress touted as a potential buyer after being beaten in the Morrisons auction.

Tobacco giant Imperial Brands slumped 3.5% to 1,499p following a trading update.

THG finally ended a long run of falling prices to grow 3.9% to 434p, while McColl’s Retail Group was also up 3.2% to 20.9p.

Greggs also suffered a big sell-off after solid gains on Tuesday following a positive trading update. The bakery chain fell 6.1% to 2,999p.

McBride, WH Smith and SSP Group were also among the fallers, down 5.4% to 70, 4.8% to 1,634p and 4.6% to 261.6p respectively.