UK: NFU "disappointed" at Morrisons meat sourcing plan

By Michelle Russell | 23 November 2012

Morrisons launched the Hemleys meat line earlier this week

Morrisons launched the Hemley's meat line earlier this week

The National Farmers Union has expressed "extreme disappointment" at the potential for UK retailer Morrisons to source overseas meat for its new tertiary brand.

The retailer launched the Hemsley's meat line earlier this week. A spokesperson told just-food "in the first instance" would be British-sourced, but could also be supplied from outside the UK "where we see opportunities to provide real value for money to customers". The spokesperson used the Netherlands would be one country of source, but not exclusive.

The NFU said the decision was "extremely disappointing" for the industry.

"British poultry producers have committed and invested in their businesses in order to supply Morrisons so it is extremely disappointing that Morrisons has made this decision," said NFU poultry board chairman Duncan Priestner. "It means fresh British chicken will be now be displaced by cheaper produce from EU countries that will not have to meet the same welfare standards and it is a blow for the industry."

Priestner said the NFU hopes Morrisons' decision was "a short-term move" the retailer will "review and reverse at the earliest opportunity".

Morrisons insisted it will still sell "a higher percentage of British meat than any other major British supermarket".

"We will buy more meat direct from British farmers than other British supermarkets. We are the only major British supermarket to run our own abattoirs that support British farmers. Of course, in these tough economic times we have to offer customers the choice of cheaper alternatives but we can be clear that our commitment to British farmers is more significant than any other retailer."

Shore Capital analyst Darren Shirley said he was "cautious" about the move, but said he understood Morrisons' motives for the sourcing decision.

"Rightly or wrongly, Shore Capital has felt that Morrisons has changed its proposition too quickly through fresh formats and range reviews and a customer corollary of this change has been to imply a move by the chain upmarket, an assertion which the company repeatedly denies it should be said."

Nonetheless, Shirley said he is "encouraged" the business is "seeking to re-engage where it matters with its core customers; in their purses".

"Returning to its value roots may stem the foot-fall outflows and provide a platform to maybe self-improve on a rescheduled timeframe.

"We are sure that as a firmly UK company, Morrison would still rather only supply British denominated fresh meat. However, if the Morrisons' customer does not recognise the implicit value of that product as presently offered, cannot afford that produce and, more to the point, only ranging such lines at prevailing price points leads to custom going elsewhere, then Morrisons has to follow its clients' needs and ants," Shirley said.

He added that he was "cautious" on Morrison stock, on which it has a 'sell' stance due to "fear a further downgrade" to its financial forecasts and "months of sector underperformance".

Sectors: Meat & poultry, Retail

Companies: Morrisons

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