An acute shortage of butchers and slaughterers in the meat processing industry has been exacerbated by COVID-19 and Britain’s post-Brexit immigration policy, which has restricted the flow of east European workers.

The government on Sunday announced a plan to issue temporary visas for 5,000 foreign truck drivers and 5,500 poultry workers to alleviate shortages but has given no indication it will introduce schemes for other areas. It argues businesses should invest in their workforce and improve pay and conditions.

Lizzie Wilson, policy services officer at the National Pig Association (NPA), said the shortage of butchers meant processors were operating at 25 per cent reduced capacity.

As a result mature pigs ready for processing are backing up on farms, causing welfare issues.

“There’s about 120,000 pigs sat on farm currently that should have already been slaughtered, butchered, be within the food chain and eaten by now,” said Wilson.

“It is getting to the point where we are saying to government if we don’t get some help soon we’re going to have to look at culling pigs on farm, because that’s our only option now,” she said, adding “there are some producers that have already had the conversation.”

Britain’s biggest pork processors are Cranswick, Morrisons, Pilgrim’s Pride and Karro Food Group.

Wilson said consumers were already seeing the impact of the crisis on supermarket shelves as processors had rationalized pork product ranges.

Minette Batters, president of the National Farmers Union, said a cull of up to 150,000 pigs was “potentially a week, 10 days away.”

“I do not feel anybody can preside over a welfare cull of healthy livestock. I don’t believe it has happened in the world before and it cannot happen now,” she told the BBC.

Batters said she wants an urgent meeting with interior minister Priti Patel and immigration minister Kevin Foster.

She said she has been trying to get a meeting with Patel for two years.

David Lindars, technical operations director at the British Meat Processors Association, said a cull “was getting very close.”

“I don’t understand this government any more. It has to get to white shelves in the supermarket scenario before they believe it,” he said.

A spokesperson for the government said it was aware of the challenges that the pig industry has faced in recent months.

“We are keeping the market under close review and continuing to work closely with the sector to explore options to address the pressures the industry is currently facing,” the spokesperson said.

— James Davey reports for Reuters from London, England.

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Natural gas prices have spiked this year as economies reopened from COVID-19 lockdowns and high demand for liquefied natural gas in Asia pushed down supplies to Europe, sending shockwaves through industries reliant on the energy source.

Carbon dioxide (CO2) is a byproduct of the fertilizer industry — Britain’s main source of CO2 — where natural gas is the biggest input cost. Industrial gas companies, including Linde, Air Liquide and Air Products and Chemicals, get their CO2 mainly from fertilizer plants.

The natural gas price surge has forced some fertilizer plants to shut in recent weeks, leading to a shortage of CO2 used to put the fizz into beer and sodas and stun poultry and pigs before slaughter.

As CO2 stocks dwindled, Britain struck a deal with U.S. company CF Industries, which supplies some 60 per cent of Britain’s CO2, to restart production at two plants which were shut because they had become unprofitable due to the gas price rise.

“We need the market to adjust, the food industry knows there’s going to be a sharp rise in the cost of carbon dioxide,” Environment Secretary George Eustice told Sky News.

It would have to accept that the price of CO2 would rise sharply, to around 1,000 pounds (C$1,739) a tonne from 200 pounds a tonne, Eustice said, adding: “So a big, sharp rise.”

The three-week support for CF would cost “many millions, possibly tens of millions but it’s to underpin some of those fixed costs,” Eustice said.

A spokesperson for Prime Minister Boris Johnson said the government was giving CF the difference between its total production costs and what it receives from the sale of CO2.

Business Secretary Kwasi Kwarteng, who also serves as energy minister, told lawmakers he was confident the country could also secure other sources of the gas.

It was not immediately clear how the state intervention by one of Europe’s most traditionally laissez-faire governments would affect the price of fertilizer — another key cost for food producers — and whether or not it would stoke demands from other energy-heavy industries for similar state support.

Christmas shortages?

Ministers, including Johnson, have repeatedly brushed aside suggestions there could be shortages of traditional Christmas fare such as roast turkey, though some suppliers have warned of them.

Kwarteng has said there would be no return to the 1970s when Britain was plagued by power cuts that made the economy the “sick man of Europe,” with three-day working weeks and people unable to heat their homes.

Eustice said without the deal some of Britain’s meat and poultry processors would have run out of CO2 within days.

“We know that if we did not act, then by this weekend or certainly by the early part of next week, some of the poultry processing plants would need to close,” he added.

He said the impact on food prices would be negligible.

But the boss of supermarket Iceland said the temporary arrangement would not solve the food industry’s problems.

“A three-week deal won’t save Christmas,” said managing director Richard Walker. “And certainly won’t resolve the issue in the long term.”

The British Poultry Council welcomed the deal but said the industry was still facing huge pressures from labour shortages and estimated Christmas turkey production will be down by 20 per cent this year.

Similarly the British Meat Processors Association expressed “huge relief.”

“We are focused on re-establishing (CO2) supplies before Friday this week which is when around 25 per cent of pork production was in danger of shutting down,” it said.

Britain’s Food and Drink Federation said there will still be shortages of some products though they will not be as bad as previously feared, while the British Soft Drinks Association warned it would take up to two weeks before production from CF made any positive impact on market conditions.

Marks + Spencer, which typically sells one in four fresh turkeys consumed in the United Kingdom at Christmas, struck a more optimistic note, saying it was confident of full supply.

Britain’s opposition Labour party said the government needed to explain the contingency plans in place in case the C02 issues are not resolved in three weeks.

— Reporting for Reuters by Guy Faulconbridge, Kate Holton and James Davey; additional reporting by Nigel Hunt and Elizabeth Piper.

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A jump in gas prices has forced several domestic energy suppliers out of business and has shut fertilizer plants that also make CO2 as a byproduct of their production process.

The CO2 gas is used to stun animals before slaughter, in the vacuum packing of food products to extend their shelf life, and to put the fizz into beer, cider and soft drinks. CO2’s solid form is dry ice, which is used in food deliveries.

The CO2 crisis has compounded an acute shortage of truck drivers in the U.K., which has been blamed on the impact of COVID-19 and Brexit.

“My members are saying anything between five, 10 and 15 days supply (remain),” Nick Allen of the British Meat Processors Association told Sky News.

With no CO2 a meat processor cannot operate, he said.

“The animals have to stay on farm. They’ll cause farmers on the farm huge animal welfare problems and British pork and British poultry will disappear off the shelves,” Allen said.

“We’re two weeks away from seeing some real impacts on the shelves,” he said, adding that poultry could start disappearing even sooner.

Retailers hit

Allen said the government was working hard to try and resolve the issue and might be able to persuade a U.K. fertilizer producer to restart its plant.

The crisis is also having a more immediate impact.

Online supermarket group Ocado said it had temporarily reduced the number of lines it is able to deliver from its frozen range. Dry ice is used to keep items frozen during delivery.

Shares in processor Cranswick, whose products include fresh pork and chicken and gourmet sausages, were down 2.7 per cent after CEO Adam Couch said production could be halted.

The British Retail Consortium (BRC), which represents retailers including the major supermarket groups, said the CO2 shortage had compounded existing pressures on production and distribution.

“… it is vital that government takes immediate action to prioritize suppliers and avoid significant disruption to food supplies,” said Andrew Opie, the BRC’s director of food and sustainability.

Britain’s National Farmers Union said it was concerned about the shortages of fertilizer and CO2.

“We’re aware of the added strain this puts on a food supply chain already under significant pressure due to lack of labour,” said NFU vice-president Tom Bradshaw.

Foreign office minister James Cleverly said the government was looking to address short-term shortages.

“We will ensure that we are able to put food on the table, obviously that is a real priority,” he told Sky News.

Britain’s big four supermarket groups — market leader Tesco, Sainsbury’s, Asda and Morrisons — had no immediate comment.

— James Davey reports for Reuters from London, England.

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This year, he fears uncertainty around Britain’s departure from the European Union will keep his eastern European workers away and the asparagus will stay in the ground.

Asparagus grown in Britain is feted by chefs as among the world’s best but the seasonal worker shortage threatens the country’s asparagus industry and the viability of Chinn’s Cobrey Farms business.

It is a predicament shared by many British fruit and vegetable farmers, almost totally reliant on seasonal migrant workers from EU member states Romania and Bulgaria taking short-term jobs that British workers do not want.

At Chinn’s farm, which turns over more than 10 million pounds (C$17.7 million) a year, the workers pick the premium asparagus spears that can grow up to 20 cm a day by hand. Sometimes they pick them twice a day before dispatching them to customers such as Marks and Spencer, and Britain’s biggest supermarket, Tesco.

“It is incredibly clear cut — there is no U.K. asparagus on your supermarket shelves without seasonal migrant workers,” Chinn, whose great grandfather started as a tenant farmer in 1925, told Reuters.

“We’re really at the point where we either import the workers or we import the asparagus.”

Britain’s asparagus season is short and early — traditionally running from April 23, known as Saint George’s Day, to Midsummer’s Day in mid-June. It will be the first big test of the 2019 seasonal labour crisis.

No-shows

This year Chinn’s team has had to work much harder to recruit Romanians and Bulgarians who are perplexed by the long Brexit process as Prime Minister Theresa May seeks parliament’s approval for a divorce deal with the EU. They are also wary of the welcome they will receive from Britons, who voted in 2016 to leave the EU.

Though Cobrey Farms has signed up 1,200 workers who are due to start arriving at the end of this month, Chinn fears many will not turn up. He does not think he will be able to harvest the entire crop, meaning valuable asparagus will be left in the fields.

“If we’re 20 per cent short of people then we will harvest 20 per cent less asparagus,” said Chinn. “U.K. agriculture’s not a high-margin game, so 20 per cent less means we’re in loss-making territory. Fifty percent could sink us.”

Chinn’s concern grew after 20 of the 100 or so workers due to help cultivate the crops in January failed to turn up.

Of 247 workers due to arrive between March 31 and April 6, 125 are yet to book flights, he said. They include 38 who have worked at Cobrey Farms before and stayed in the dozens of static caravans that stand at the foot of the hills on the farm.

Chinn, who voted Remain in the 2016 Brexit referendum, said uncertainty over eastern Europeans’ employment rights and how long they can stay, combined with a fall in the value of the pound, meant Germany and the Netherlands were now considered more attractive destinations.

“They go somewhere which is most straightforward and any, even minor, hurdles you put in their way is just nudging them ever closer to going somewhere else,” he said.

With just 11 days to go until Britain is due to leave the EU, the government is yet to agree a withdrawal arrangement or an extension, meaning the risk of a disorderly “no-deal” Brexit cannot be ruled out.

If Britain agrees on a divorce deal, a transition period will kick in, maintaining freedom of movement until the end of 2020. In the event of no deal, EU citizens arriving after March 29 would need to register to work for more than three months.

Elina Kostadinova, a 28 year-old harvest manager at Cobrey Farms who is from Varna on Bulgaria’s Black Sea, said many workers were worried about coming to Britain because of Brexit.

“They don’t know if they will be welcomed in the country, how long they may be able to stay, how they may be able to travel and what the future may hold,” she said. “It would be wonderful if the U.K. government could make a decision, so we can relay this message.”

British farms typically pay workers the national minimum wage of 7.83 pounds (C$13.90) an hour plus performance-related bonuses.

Chinn said the idea of British workers plugging the gap was fanciful. He does not expect much help from the supermarkets, where sales volumes have already been negotiated for the season and prices have been fixed, barring exceptional circumstances.

Permit trial

Britain’s fruit and vegetable sector relies on up to 80,000 seasonal workers from the EU each year. Having previously been inundated with applications, labour agencies say interest dropped off in 2017 and 2018 as workers from Romania and Bulgaria opted to go elsewhere in the EU.

For the last two seasons, Britain has been short by around 10,000 workers, threatening the food supply and forcing farms to pay higher wages and bonuses. At the end of the summer as workers want to leave, farms will offer free accommodation and to pay the cost of flights to try to persuade them to stay on.

Concordia, a labour agency charity that finds EU pickers for British farms, said it now has to work much harder to recruit.

“U.K. agriculture is definitely entering into a crisis. No labour means no harvesting, which means no fruit and no vegetables on shelves in British supermarkets,” Chief Executive Stephanie Maurel told Reuters.

She was speaking in Moscow after the British government sanctioned a pilot trial for 2,500 workers to enter the country from Russia, Ukraine and Moldova for up to six months over the next two years.

Chinn, who has 3,500 acres of land, wants the government to increase the numbers to 10,000 this summer and over 50,000 in the next couple of years.

“We can’t change this natural cycle of the crop… the crop will come out the ground when it warms up,” he said. “So the key is about not waiting for a total disaster that wipes out large swathes of UK horticulture.”

— Reporting for Reuters by James Davey and Kate Holton.

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As the country counts down to Brexit while politicians remain deadlocked over how best to oversee its departure on March 29, Tesco said it had increased stockholdings of ambient foods such as bottles, packets and tins and made clear plans for each product category.

But, with Britain importing about half the fresh food it eats, putting no-deal contingencies in place for perishables was not an option.

“It’s not so possible to do that sort of thing on fresh food, so that’s where the pinch point would be if there were to be a no-deal,” CEO Dave Lewis said.

On Wednesday No. 2 supermarket player Sainsbury’s, which imports about 30 per cent of its food from continental Europe, issued a similar warning.

“It will be hugely disruptive if there was a no-deal Brexit for the supply chains that we operate…,” its CEO Mike Coupe said.

“No amount of stockpiling will mitigate that risk simply because we don’t have the capacity and neither does the country to stockpile more than probably a few days’ worth.”

The uncertainty over Brexit looks set to deepen on Tuesday, when a divided parliament is expected to vote down the departure deal that Prime Minister Theresa May struck with Brussels.

May has said a vote against would be opening the way for a disorderly exit or for Brexit not to happen at all, while opposition Labour leader Jeremy Corbyn called on Thursday for an election to break the impasse.

Supermarket groups, under pressure to keep shelves stocked with hundreds of thousands of product lines, want as little friction as possible at European borders. They fear a no-deal Brexit could mean major delays at ports.

Analysts pointed out that in 2018 it only took a few days of heavy snow disruption when the “Beast from the East” hit Britain before gaps opened up on supermarket shelves.

They also say that any pinch in supply will likely result in price increases in fruit, vegetables, meat and dairy products.

No. 4 supermarket player Morrisons said on Tuesday its Brexit planning group had moved to “a more operational footing,” while on Thursday Marks + Spencer said it had “upped the ante” and started to make choices.

— Reporting for Reuters by James Davey and Paul Sandle.

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