Tesco boss looks to futureproof shopping baskets

Supermarket chain Tesco is looking beyond the current cost-of-living crisis to build a more resilient, secure, sustainable and productive food system, according to CEO Ken Murphy. 

Addressing the Reuters IMPACT climate summit, he called for “widespread transformational innovation” and argued that cutting carbon can also cut costs, futureproof British farming and stimulate green growth.

Context 

The combined impact of Covid, a supply chain crisis and war in Ukraine has driven UK inflation to levels not seen in a generation, with food prices among those rising fastest. It’s a development that recently prompted the UK government to postpone, for a fifth time, the introduction of post-Brexit import checks on food, plant and animal produce arriving from the EU. 

Why UK supermarkets matter

Tackling increased food costs is essential for UK supermarkets, which pride themselves on being among the most competitive in the world. They’ve done a lot on reducing costs within their current set-ups, but they now need to look at how they can introduce new ways to keep costs low into the future. That means working closely with suppliers and partners to address the green agenda, and having backing from a government that will stand by Net Zero commitments and timelines and support innovation.

Takeaways 

• An independent review of Net Zero found that reducing emissions in agriculture could save farm businesses up to £170m a year by 2035 and more than £1.5bn by the year 2050. 
• With standard ammonia-based fertiliser costs leaping 140% in the past year, Tesco is ramping up tenfold a low-carbon fertiliser trial which utilises material including food waste, chicken litter, fire extinguisher waste and algae. 
• The supermarket is also investing in wind and solar farms. “The issues of energy security and food security are interconnected,” said Murphy. “Solutions in food security can help unlock energy security and vice versa.” 

Key quote

“Sustainability and economic growth should go hand in hand, not head to head … without the right incentives and innovation now, food prices will be significantly higher and more volatile for households in the future” – Ken Murphy, CEO, Tesco. 

BEC