DESPITE all the challenges from pizzas, burgers, Indian and Chinese take-aways, kebabs, chicken buckets and other fast foods – fish and chips continues to remain not just part of our rich culinary heritage but a very popular meal. It regularly comes top of polls and research on the most popular take-away meal and also happens to be cheaper than most other options – but the cost-of-living crisis has had an impact, thanks to the rising prices for fuel, cooking oil and ingredients.
Tragically, as with other take-aways, businesses are under threat from rising catering costs and it is reported as many as a third of the UK’s fish and chip shops – some 3,000 – risk closure. Energy costs have trebled, a shortage of Sunflower Oil has caused its cost to double, a poor potato harvest has doubled the price of spuds and Russian fish now attracts a very high tariff to discourage its use due to Putin’s invasion of Ukraine. It’s an unfortunate perfect storm.
Thankfully, there is good news over the horizon, literally.
There’s a way we can make fish and chips even more price competitive – by using the Brexit bonus of our membership of the CPTPP that has eliminated the tariff (worth up to 18% of additional cost) on Malaysian Palm Oil. This is important because Sunflower Oil has doubled in price and is now 20% dearer than Palm Oil.
There can be no doubt the cost-of-living has hit families hard. In particular the cost of energy and the cost of many raw materials have impacted on both family budgets directly (such as fuel costs) – or indirectly as cooking, transport and tax costs feed-in to various items, are added together and then passed on to customers, be they families or businesses.
Brand manufacturers and supermarkets can help by lowering the cost of most consumed products by focusing on cheaper alternatives – but they need to be inventive and think about doing things differently. One factor that has not yet received much interest is the ability of using Brexit as a means to reduce costs by providing cheaper ingredients because we control our own import tariffs. Whereas the EU places high tariffs on food supplies from outside the EU (to protect its own food producers) the UK can now decide for itself and in sectors where we do not grow or process foods there is no need to erect needless barriers that make food dearer.
Now that the UK has signed the CPTPP agreement with eleven Pacific countries we have agreed we can import Palm Oil from Malaysia tariff free.
During the past 2 years, the FAO Food Price Index has increased by 67% driven mostly by vegetable oils whose prices have increased by a whopping 185% during this period. Russia’s invasion of Ukraine severely impacted on Sunflower Oil supply (together, both countries control 70% of the global sunflower oil market) leading to global vegetable oil shortage and a rally in its prices. Fortunately, food brands and producers can switch to alternatives like sustainable Palm Oil which has a far higher yield per hectare – meaning it requires far less land to grow a 1000 litres of vegetable oil – making it 6-10 times more productive than other oilseeds such as rapeseed, soybean, olive, or sunflower. As well as bringing down the cost of processing of foods generally (such as bakery products) sustainable Palm Oil could go a long way to addressing the cost of living crisis for our nation’s chippies. And as 85% of the world’s Palm Oil is exported from Malaysia and Indonesia, so it is less affected by the war in Ukraine.
Ukraine produces around 19 million tonnes of Sunflower Oil annually, and with Russia makes up nearly 80% of global crude Sunflower Oil exports, although Russian Sunflower Oil is now embargoed to most of the West. Sunflower seeds are generally sown in April and May, and harvested in September – none of which looks likely to take place this year – likely driving down Sunflower Oil supply and pushing prices up again. Estimates suggest the continuing war in Ukraine is likely to lead to a 25% cut in supplies of sunflower oil in the next fiscal year.
While EU members will have to fight over the Sunflower Oil the UK can pivot towards Palm Oil at a cheaper price and not only reduce the inflationary impact on Fish and chips but also know that the sustainable farming of Palm Oil in Malaysia has ensured the problem of deforestation has been overcome.
True, the palm oil industry has often been persecuted because of its past links to deforestation, but great advances in sustainable farming practices and monitoring of them means over 90% of palm oil imported into the continent of Europe (including the UK) is certified sustainable and does not cause deforestation. With its large vegetable oil farming interests the EU discriminates against Palm Oil imports using deforestation as an excuse for high tariffs, ignoring the environmental achievements of recent years.
The great news for chippies is that Palm Oil can handle frying without spoiling, while its low production costs make it cheaper than frying oils such as cottonseed or sunflower, and unlike traditional beef dripping, Palm Oil is suitable for both vegetarians and vegans.
It’s time to fire-up the fryer with CPTPP-sourced Palm Oil and get the price of a fish supper down.
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