Analysis proves UK apple growing is a “loss-making” industry
19th April 2023
An independent analysis, conducted by farm business consultants Andersons, showed the median cost of producing a kilo of British apples is now £1.26, exposing the true cost of production crisis facing UK apple growers.
The figures are based on data gathered from UK Gala apple growers, whose combined output represents over 50% of all British apple production. The analysis incorporates the costs of tree establishment/end of life, growing and harvest, storage and marketing, as well as overhead costs.
Commenting on the results, British Apples & Pears Limited (BAPL) executive chair Ali Capper said: “I can’t think of a single apple grower that is making money. The costs of labour, storage, haulage, tree planting and orchard maintenance have all increased. What hasn’t increased is the return to growers.”
Mr Capper added the analysis confirms what UK apple growers have been saying for months, that the industry is not only unprofitable, but in fact loss-making.
“When growers cannot afford to invest in new apple trees and are grubbing orchards, the consequences are serious, not just for growers but also for the rural landscape and economy. We face biodiversity loss, lower returns to the treasury and poorer outcomes for consumers,” he said.
To help the industry get back on its feet, the BAPL is calling for urgent government intervention to stop unnecessary imports and restore fair returns for growers. The organisation’s asks are:
- To add grower businesses to the ETII (Energy and Trade Intensive Industries) scheme list to lessen the impact of rising energy prices on cold storage of fruit
- To support the development of renewables (wind and solar), especially the storage of renewable energy to help mitigate the energy cost increases facing growers and reduce CO2 emissions
- To remove the limit on the number of seasonal workers allowed into the UK and increase the current permit to a nine-month visa
Mr Capper stressed: “We need to see specific government support to address energy costs and labour shortages, and we urgently need fairer returns for growers from UK supermarkets to ensure the future of the British apple industry.”
According to the BAPL, there is a major disconnect between the prices consumers are paying for apples and the return to growers. Although data has shown the lowest consumer price of apples increased 17% between September 2021 and September 2022, growers only reported a 0.8% increase in what supermarkets pay them for their fruit.
Therefore, the BAPL is asking retailers for:
- A reset on returns to recognise the unprecedented cost of production inflation
- Long-term partnerships and prioritisation of British apples and pears over imports to enable growers to invest in the future with confidence
- To work with growers to reinvigorate the category with in-store and online ‘theatre’, and packaging that celebrates the many benefits of British apples
Lastly, the organisation pointed out that despite significant cost increases, British apples remain highly affordable. A single British apple costs around 34p to UK shoppers, which is less than half the price of a chocolate bar and comes with huge nutritional benefits.