United Kingdom food
suppliers, retailers, and foodservice providers are requesting more government
help as soaring food costs pushed inflation to record levels.
Overall food and drink inflation increased from 18.2 percent in February to 19.2 percent in
March, according to new data from the Office of National Statistics.
“This is the highest rate in 45 years since August
1977,” the Food and Drink
Federation said.
The largest category
increase was in bread and cereals which saw 19.4 percent in March – the highest
annual rate on record, according to FDF. Chilled fish inflation was
significantly lower than olive oil, sugar, cheese, eggs, pork, and many other
food items, but still climbed by 19 percent in March.
Foodservice price
inflation remains over 20 percent, according to UKHospitality, and new research shows the price pubs paid for
food rose three times quicker than menu prices.
The new figures “come
as a disappointment to households up and down the country as the cost of the
weekly shop continues to rise,” FDF Chief Executive Karen Bett said. “Food and drink price inflation remains stubbornly
high because it takes some months for the rising prices that manufacturers pay
to produce food and drink to filter through into the prices that shoppers pay
on high streets and in supermarkets.”
More than 80 percent
of food and beverage manufacturers are absorbing a proportion of rising input
costs to shield shoppers from the full price increases, according to ONS data,
Bett said.
“This is having an impact on business margins and the
resilience of our sector. A drop in investment is flowing from this and points
to a worrying economic trend,” Bett said.
Food suppliers are
facing pressure from Tesco, Sainsbury, and other major grocery chains that have
launched programs this year to lower prices.
Tesco shuttered all of its fresh seafood counters earlier this year and cut numerous executive positions, while implementing price locks on more than 1,000 grocery items, including Tesco Breaded Plaice Fillets.