Road pricing would pose supply chain headaches

By Rick Pendrous

- Last updated on GMT

Related tags: Transport

Road pricing would pose supply chain headaches
As road pricing rises up the government's agenda, the food and drink sector - a major contributor to atmospheric pollution and congestion on our...

As road pricing rises up the government's agenda, the food and drink sector - a major contributor to atmospheric pollution and congestion on our roads - is being forced to look at novel ways of raising its supply chain efficiency even further.

To avert gridlock across the nation and meet greenhouse gas emission targets, environment minister David Miliband is considering charging road users according to the distance travelled, the time of day and the type of road they drive on. For the food and drink sector, where the majority of goods are transported by road, this has major cost and logistical implications.

Pilot road pricing schemes are expected to begin as early as next year, with full roll-out possible within the next 10 years, according to Paul Steedman, a research fellow at the Brighton-based Food Ethics Council, who is conducting a 18-month project, started in September this year, to harness the potential of road pricing to promote sustainable food systems by ensuring that the impacts of food distribution are fully considered in transport policy.

Between now and March 2008, Steedman will analyse the long-term effects of transport policy on food distribution; explore future scenarios for food distribution; examine transport policies that could help to deliver more sustainable food systems; and engage stakeholders in the project's deliberations and findings.

Already the night-time ban on lorry movements in London causes major scheduling issues for manufacturers, such as baker Warburton, which already has very tight delivery windows . Any further extension of restrictions and congestion charging will inevitably exacerbate problems for those involved in short shelf-life deliveries. However, third-party logistics suppliers recognise that government action on road pricing is almost inevitable.

Road transport forms a big plank of the government's Food Industry Sustainability Strategy (FISS) published earlier this year. It called for "significant" reductions in the environmental and social costs of transportation by 2012.

FISS sets targets for reducing carbon emissions by 20% by 2010 from a 1990 baseline. Research carried out on behalf of the Department for Environment, Food and Rural Affairs in 2005 by AEA Technology showed that the food industry is responsible for a large part of the £9bn annual cost to the nation of food transport, through road congestion, road accidents, climate change, noise and air pollution. Food transport now accounts for 25% of all heavy goods vehicle (HGV) kilometres in the UK.

More than half of the costs (£5bn) estimated in the study were due to road congestion, for which consumers were also partly to blame. But, while the contribution from HGVs has decreased in recent years due to more efficient loading and routing of vehicles, including more backhauling, this trend is unlikely to continue. Retailers are also looking at transferring more road transport to rail and using local ports for imports, but there are limits on what this can achieve.

Despite increasingly vocal calls from environmentalists and others for more locally produced foods, the impact of food transport has to be offset to some extent if food imported to an area has been produced more sustainably than the food available locally. In this respect life-cycle analyses are increasingly being used to determine sustainability of the food chain.

Related topics: Supply Chain, IT, Services

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