Chief Executive’s Weekly News for 29th July 2019

Dear All,

Detailed below is the Weekly News for 29th July.

I have eschewed new PM and Brexit-at least for now-all that’s certain is that there will continue to be uncertainty!

Have a good week.

 

Gordon Polson – Chief Executive

Federation of Bakers Ltd

CBI Economic Update: Your quarterly guide to the UK economy; making sense of the key trends and what’s driving them. Q2 at-a-glance:

  • The UK economy continues to grow at a subdued pace. Looking forward, we expect growth of 1.4% in 2019 and 1.5% in 2020, following 1.4% growth in 2018
  • UK economic growth sped up to 0.5% in the first quarter from 0.2% in Q4 2018. The pick-up in economic activity was supported by businesses’ temporary stockpiling activities ahead of the recent Brexit deadlines. Much of this stockpiling was driven by the manufacturing sector, which reported its fastest growth rate (1.9%) in nearly 20 years
  • The boost from stockpiling is set to unwind in Q2, with official data so far suggesting that the economy has largely flatlined
  • The picture for stockpiling activities since the extension of Article 50 (to 31 October), however, seems to be more mixed. Some firms are choosing to maintain stocks levels (at a cost to working capital), while others have decided to run down the stocks they built up in Q1
  • Private sector business volumes fell in the quarter to June, at the quickest pace since September 2012. The acceleration in the pace of decline was driven by the sharpest fall in the distribution (including retail) sector’s sales volumes since the financial crisis
  • Meanwhile, the May Bank of England Inflation Report saw UK GDP growth upgraded across the forecast period. GDP growth was projected to hit 1.5% in 2019 (from 1.2% in the previous forecast), picking up to 1.6% in 2020 (from 1.5%) and 2.1% in 2021 (from 1.9%). Note that these forecasts were conditioned on a “smooth” Brexit outcome
  • The labour market in the three months to April 2019 remained remarkably tight. The employment rate was at the joint-highest since comparable estimates began (in 1971). Meanwhile, the unemployment rate remained at its joint-lowest since 1974 (3.8%)
  • The CBI’s July global forecast downgraded growth prospects for the global economy in 2019. Specifically, the projected growth rate for 2019 was revised down by 0.5pp to 3.0%, largely due to downgrades in Eurozone growth prospects. Meanwhile, the global growth forecast for 2020 was unchanged at 3.5%
  • Tariffs levied by the US and China (so far) are expected to have a small, but noticeable, impact on global growth.

NutriScore and YUKA app: Some of you may already be familiar with the YUKA product scanning app in France (https://yuka.io/en/)  It is fast becoming the most influential driver of consumer food choice in France, and some suppliers are now seeing a direct influence from Yuka on product development briefs from customers.

Launched in France in 2017, the app has grown from 1.8 million downloads in 2018 to more than 10 million downloads already in 2019.

Given its current momentum, we’re likely to see this take off across Europe. It has already extended to Belgium, Switzerland, Luxembourg and Spain. It was launched in the UK on June 24th (Launches are planned for the USA and Canada before the end of this year)

Yuka’s food product scores are based on three criteria:

 

  1. NutriScore value (60% weighting) … Yuka is effectively giving a turbo-boost to the awareness and impact of NutriScore
  2. Presence of additives (30% weighting) … every additive is assigned a risk level based on “recommendations of the EFSA, ANSES, and the IARC, in addition to numerous independent studies” … this is contentious.
  3. Organic (10% weighting) … based on presence of the “Euro-leaf” organic label

 

For products that have low scores, Yuka makes very specific recommendations about alternative products to consider.

It’s probably of interest to become familiar with this app, and to be seen by customers to understand the ‘Yuka’ impact on nutritional profile and label cleanliness in their food and beverage development.

Warning: Some use of the app has highlighted ‘low’ or ‘very low’ scores for UK white bread.

 

 

Government consults on health & prevention in the 2020s: On 22 July, just before Boris Johnson became Prime Minister, the Cabinet Office published a Prevention Green Paper for consultation, seeking views on proposals “to help people live healthier, happier lives for longer.” It has been suggested that the Cabinet Office rather than the Health Department published the Green Paper because the Health Secretary, Matt Hancock, wanted to wait for it to be approved by the new Prime Minister and Cabinet.  Interested stakeholders have until 14 October to comment on its proposals, which cover healthy weight, alcohol consumption, smoking and mental health as well as other important public health issues, such as clean air. The paper includes  “Chapter 3 of the childhood obesity plan” (scroll down) and sets out plans for: infant feeding, clear labelling, food reformulation improving the nutritional content of foods, and support for individuals to achieve and maintain a healthy weight.  Among other commitments, it announces that the Government will end the sale of energy drinks to children under the age of 16; and says the Government will “challenge businesses to improve the nutritional content of commercially available baby food and drinks, with Public Health England (PHE) publishing guidelines for industry in early 2020.  The Government will also “explore how we can improve the marketing and labelling of infant food”. On the Soft Drinks Industry Levy (SDIL) it says that “if the evidence shows that industry has not made enough progress on reducing sugar, we may extend the SDIL to sugary milk drinks.”   Commenting on other Government consultation proposals concerning mandatory calorie labelling mandatory in the out-of-home sector;  banning promotions of foods and drinks high in fat, sugar and salt (HFSS) by price and by location; and a 9pm watershed on TV advertising of HFSS products plus similar protection for children viewing adverts online, the paper only says that the Government’s response and next steps on policy will be published “as soon as possible.” The Public Health Minister, Seema Kennedy, subsequently issued a written statement about the Green Paper on 23 July.

List of all EU authorised and rejected nutrition and health claims: On 26 March, DHSC published a register of all authorised and rejected nutrition and health claims in the UK. In the event of a no-deal EU Exit, only authorised claims in the register may be used in the UK. See https://bit.ly/2XNPEJt Procedures are also in place in the event of a no-deal EU Exit for assessment of nutrition and health claims to be carried out by the UK Nutrition and Health Claims Committee (UKNHCC) https://bit.ly/2FKQzQ7

 

EFSA reschedules sugars opinion in order to assess wealth of data: The European Food Safety Authority (EFSA) has announced a new timeline for its scientific advice on dietary sugars due to the high volume of datasets and studies to be collected, analysed and assessed. EFSA has agreed a deadline extension with the 5 European countries that requested this scientific advice and aims to have a draft ready for public consultation in late 2020, with a view to finalising the work in 2021.  EFSA experts will attempt to set a tolerable upper intake level for total/added/free sugars if the available data allow it. Otherwise, other values could be used to characterise the risk of excess sugar consumption. This research will inform the work of national authorities as they establish healthy eating guidelines.

 

 

Industrial Heat Recovery Support Programme: Acting on feedback from stakeholders, BEIS have made some improvements to the Industrial Heat Recovery Support (IHRS) Programme.

Firstly, the programme has been extended until March 2022. Second, third parties can apply as main applicants on behalf of sites that fit within the IHRS eligible Standard Industrial Classification (SIC) Codes. Finally, two additional assessment windows are now available in 2020 with deadlines at end of January and July. This extension will allow participants more time to enter the programme and implement projects that are more challenging. The IHRS has 13 successful applicants so far, in industries ranging from food and drink to chemicals, steel, minerals and paper sectors, covering an exciting range of diverse projects.

The IHRS delivery partner, ICF, will continue to offer support to potential applicants through the process and can provide feedback on early drafts of applications. The IHRS is the only government Programme focused solely on industrial heat recovery, therefore it’s the best option for businesses considering a heat recovery project to seek funding.

For more details on how to apply, call 020 3096 3106 or email the IHRS programme, or alternatively visit the IHRS website for a step-by-step guide on how to apply. Businesses should consider applying now to get the most value from the IHRS.