UK Chancellor Reeves convenes supermarket CEOs to tackle looming food price surge amid Middle East‑driven energy crisis

The UK’s chancellor, Rachel Reeves, is set to sit down with the chief executives of Sainsbury’s, Tesco and Morrisons on Wednesday. The meeting aims to gauge the scale of possible price hikes and shortages of essential household goods as the nation grapples with a sharp rise in energy, fuel and fertiliser costs triggered by the ongoing Middle East conflict.

A Treasury source described the gathering as a "fact‑finding, open discussion" intended to identify any supply squeezes and to forecast the impact on the cost of living over the coming months.

Allan Leighton, executive chair of Asda, will not attend but has publicly urged the government to "stand up and start doing stuff" to aid farmers and curb fuel prices, warning that food costs will inevitably climb if the conflict persists.

Simon Roberts, chief executive of Sainsbury’s, cautioned that price increases are "unlikely to rise until the summer" thanks to long‑term contracts on energy and fertiliser that currently keep a lid on costs.

Nevertheless, UK growers are sounding the alarm. Producers of tomatoes, cucumbers, peppers and aubergines say higher input costs could force them to pull plants from the ground, creating potential gaps on supermarket shelves.

Lee Stiles, secretary of the Lea Valley Growers’ Association – the region often dubbed London’s "salad bowl" – is lobbying for indoor food producers to be classified as "energy‑intensive users" alongside steel, chemicals, cement and glass, thereby qualifying for additional support with surging energy bills.

Stiles also called on retailers to renegotiate contracts with growers to reflect the cost surge since the Middle East conflict began. He warned that the upcoming increase in standing charges on 1 April – a fixed daily fee for accessing the gas and electricity network – will further strain producers’ margins.

"Growers have already invested in plants and labour for three to four months," Stiles said. "When you do the maths, the numbers don’t add up. They would lose less money by sending workers home, pulling the plants out and turning off the boiler."

If domestic growers cut the season short, European glasshouses, which normally supply the UK’s salad market at this time of year, may struggle to fill the void, risking a repeat of the fresh‑produce shortages experienced in early 2023.

The British Poultry Council (BPC) echoed these concerns, highlighting pressures on supplies of oil, gas, fertiliser and essential feed components. "These factors are creating sustained upward pressure on the cost of poultry production," the BPC warned, adding that while some cost increases may be absorbed, others will inevitably be passed on to consumers.

Richard Griffiths, BPC chief executive, noted that while many farmers have long‑term energy deals, costs such as diesel are rising rapidly, and there are fears that vital medicines could become unavailable at any price.

In response, the government has announced a £117 cut to household energy bills, an increase to the legal minimum wage, and the launch of a £1 billion "crisis and resilience" fund aimed at helping vulnerable households with expenses such as heating oil.