Welcome to the May edition of the 2025 Atticus Partners food and drink newsletter: Food for Thought. These bulletins bring you updates on what Atticus is doing within the food and drink space including blogs, our #AskAtticus speaker series and events we have attended, as well as key news and political updates of relevance to the sector.
In this edition, we explore the industry's reaction to the UK-EU trade agreement and the challenges – as well as potential solutions – facing the sector, including how AI can impact its future. Alongside this, we take a deep dive into the Panorama documentary on baby food pouches, including its implications for the future of childhood obesity in the UK.
For more information about Atticus’s work in the food and drink sector, or if you have any questions about how we can help you navigate our fast-changing political landscape, please get in touch via foodanddrink@atticuscomms.com
Trade, Tech & Timing: What’s Shaping UK Food in May
The UK food and drink sector saw significant policy and regulatory developments over the past month, with key shifts in trade, labour strategy, and sustainability. Perhaps most notably, the newly announced UK-EU trade agreement has been broadly welcomed by major retailers and food producers, signalling a potential return to operational stability following years of post-Brexit disruption. As reported by Reuters, the deal offers streamlined customs processes and reduces friction at borders - a relief for import-heavy segments like fresh produce and packaged goods. However, while the retail sector has expressed cautious optimism, UK fishermen have voiced strong opposition, citing perceived compromises in fishing rights and access, with some feeling the industry has once again been used as a bargaining tool – particularly in Scotland.
Alongside trade concerns, a new report from the Institute of Grocery Distribution (IGD) puts focus on the food sector’s mounting labour challenges, urging businesses to embrace automation and AI as long-term solutions. From abattoirs to packhouses, food producers are under pressure to maintain output despite a persistently thin labour pool. Included in this month’s Convenience Store UK, the report encourages investment in robotics for sorting, picking, and processing, positioning tech not as a futuristic luxury but as a necessary ingredient for operational survival. While larger manufacturers may be able to swallow the upfront costs, smaller producers and artisan firms risk being left behind, raising questions for government about how to manage equity and access, particularly in the context of Labour’s ambition to support British brands and ‘home-grown’ produce.
As the UK saw sunnier spells in May, environmental factors and climate volatility have also taken centre stage over the last month. According to The Guardian, the UK experienced an unusually early and abundant harvest of fruits and vegetables this spring - a direct result of warmer temperatures and a shortened so-called "hungry gap." While this might seem positive on the surface, the glut has exposed vulnerabilities in the food supply chain, particularly around storage, processing capacity, and demand forecasting. Farmers are reporting both waste and revenue losses due to a mismatch between peak yield and market readiness. This comes amid growing pressure on the government to align agricultural policy more clearly with climate adaptation strategies, especially as such seasonal disruptions are projected to become more frequent.
Elsewhere, consumer-facing trends offer some contrast to the sector's more complex policy challenges. The Telegraph recently noted that UK food festivals are enjoying a surge in popularity moving into the summer, pointing to a broader cultural engagement with local food, craft producers, and regional specialities. These events - from niche artisan gatherings to larger-scale public showcases - have become important platforms for innovation, visibility, and local economic growth for brands, where the public's ongoing appetite for food as experience signals continued opportunity for branding and community engagement across the sector.
As the UK food and drink industry navigates this evolving landscape - balancing trade realignments, technology demands, and shifting consumer habits - the need for coordinated, pragmatic policy remains clear. What’s evident from this past month is that structural change is no longer on the horizon - it’s already underway.
Insights from Atticus
The Hidden Truth in Baby Food Pouches: What Panorama Revealed About Childhood Obesity by Ellie Anderson
Baby food pouches, a staple in many babies' lives—and a food source for hundreds of thousands of children in the UK—have come under scrutiny following the BBC Panorama documentary, "The Truth About Baby Food Pouches."
The investigation particularly highlighted concerns about the nutritional value of these products and their potential link to rising childhood obesity rates in the UK - especially pressing in London, where childhood obesity far exceeds national averages. With the early years of development crucial for establishing healthy eating habits, the documentary's findings proved to be a significant wake-up call for parents and have led to considerable panic among policymakers and nutritionists alike.
The research was conducted in partnership with the University of Leeds and involved testing 18 baby food pouches from six leading UK brands. The results revealed high sugar levels, even in fruit pouches marketed as having "no added sugar." Alongside this, many pouches showed insufficient essential nutrients like iron and vitamin C, vital for infant development. Savoury pouches, often used as meal replacements, were notably low in iron, which is crucial for cognitive development. Some fruit pouches also experienced a loss of vitamin C during manufacturing.
With researchers recognising that the high sugar content in many baby food pouches can contribute to increased calorie intake without providing adequate nutrition, several experts attested that this could lead to unhealthy weight gain. It was also acknowledged that early exposure to sweet tastes can shape a child's palate, fostering a preference for sugary foods later in life as sugar addictions take hold. Furthermore, low levels of essential nutrients like iron have been linked to an increased risk of chronic diseases, including obesity.
The research has been met with widespread worry and outrage. The British Dental Association also expressed concerns about the high sugar content and its impact on dental health, with almost 1 in 5 children under 5 experiencing dental decay. Organisations like the Obesity Health Alliance have called for mandatory sugar limits on baby food.
It comes as the government, desperate to cut childhood obesity, which affects 27% of children in the UK aged between 2 and 15, scrambles for answers on how to tackle the growing issue. Launching a consultation a matter of weeks ago on whether to bring milk-based drinks under the sugar tax to combat the issue, the move represents a significant shift in the government’s public health approach—aiming to reduce sugar consumption in children and its link to both rising obesity rates and type 2 diabetes.
As the government doubles down on its agenda of a ‘prevention first’ approach to healthcare, it’s now essential that the problems identified above are addressed before the UK’s obesity epidemic is passed on to the next generation.
What We’ve Been Reading
The UK has ratified its entry into the £12trn Indo-Pacific trade bloc (CPTPP), paving the way for tariff-free exports on over 99% of goods. A new tax deal with Peru will also prevent double taxation for UK firms. Food and drink businesses stand to benefit, with reduced tariffs on whisky, cheese, chocolate and dairy, particularly in fast-growing Asia-Pacific markets. Exporters like Glasgow Distillery and Somerdale International welcomed the deal as a “positive move” for expanding trade.
TBI: Faster, Broader Access Can Drive Health and Wealth in the UK
The Tony Blair Institute has called for a new government unit – Protect Britain – to lead the large-scale, digital-first rollout of weight-loss drugs like tirzepatide. NICE recommended the drug for 2.8 million patients, but NHS England delayed full rollout due to cost and capacity concerns. TBI argues this will worsen health inequalities and economic strain, proposing means-tested access via the NHS App and private providers. Modelling shows the plan could deliver £52bn in fiscal benefits by 2050 and boost GDP by up to 0.55%.
EU Startups: Tech meets taste: How AI is revolutionising the food industry
Traditional food product development is too slow for today’s fast-moving consumer trends, where 90% of new launches still fail. AI platforms like Tastewise are helping brands decode real-time consumer preferences by analysing billions of social posts, recipes, and reviews. These insights are driving faster product cycles, aligning launches with demand for affordable, functional foods, and boosting marketing precision.
Raconteur: UK supermarkets on high alert following M&S, Co-op and Harrods cyber attacks
M&S, Co-op, and other major UK food retailers have been hit by cyberattacks, disrupting payments and supply chains. As hackers target critical infrastructure, the government and grocers are racing to tighten digital defences. Expect more focus on cybersecurity across the food sector.