One of Australia’s major poultry suppliers Ingham’s is temporarily suspending the production of several products amid severe staff shortages due to Covid-19. Ingham’s CEO and managing director Andrew Reeves says the Omicron variant has presented unprecedented challenges for its Australian business.
“The operational and trading difficulties have resulted in significant operational inefficiency, additional costs and temporary suspension of a number of Ingham’s products. Ingham’s is working closely with customers and we are focused on supplying as much product as possible while the current disruption continues,” he said.
At its AGM, Reeves flagged the extended Covid lockdowns in New South Wales, Victoria and Auckland as a significant issue.
As of December, the Omicron variant has exacerbated staff shortages, which is now impacting the Australian supply chain, operations, logistics and sale performances, as well as a number of its suppliers and customers.
Reeves said many of the company’s employees are in isolation due to contracting Covid or being a close contact.
As a result, the company is battling reduced production volumes while its major Australian sites remain operational.
“We are currently maintaining our Australian processing operations while seeking to ensure the safety and engagement of our employees, with many demonstrating outstanding levels of commitment to work through the current challenges,” said Reeves.
Ingham’s Australian business is making operational changes to volume and mix but is unable to pinpoint the overall impact due to the uncertainty of how long this latest Covid iteration will last.
Reeves added that the federal and state governments’ changes on close contact isolation requirements should alleviate the strain on the food sector.
“As operating conditions begin to stabilise, we expect our production capacity to recover relatively quickly to meet customer and consumer demand,” he said.
Reeves said the company is continuing to manage Covid related impacts throughout FY22.
“We will continue to closely manage our working capital and inventory and seek to implement initiatives to minimis the financial and other impacts of Covid through the second half of FY22,” he said.
Staff shortages have presented severe overall complications for the food sector. Organisations including the Australian Food and Grocery Council, the Australian Fresh Produce Alliance and Ai Group have called on the national cabinet to create a national uniform set of rules on Covid testing, isolation and returning to work in its meeting today.
