Figures published by the British Retail Consortium (BRC) confirm that food inflation accelerated in March to 2.5%, up from 1.6% in February. This is the highest inflation rate since November 2013.
With specific regard to fresh food, inflation within this category accelerated to 1.9% in March, up from 1.7% in February. This is the highest inflation rate since October 2017.
[colored_box color="green"]BRC is pointing to the strengthening of global commodity prices and weather events as the contributory factors.[/colored_box]
Rises in global grain prices pushed bread & cereal prices up. Last year’s bad weather meant that a number of UK crops, such as onions, potatoes, and cabbage, saw much lower yields, and, as a result, these products are now seeing significant price increases.
Helen Dickinson, chief executive at BRC, commented: “March saw shop price inflation rise to its highest level in six years, driven primarily by a sharp spike in non-perishable food inflation.
Increases in global commodity prices and adverse weather events put upward pressures on the wholesale prices of many foodstuffs which, coupled with rises in the cost of alcoholic and non-alcoholic beverages, pushed food inflation from 1.6% in February to 2.5% in March.
She added: “Nonetheless, the bigger threat to food inflation remains the risks of a chaotic no-deal Brexit, which would lead to higher prices and less choices on the shelves.
“In order to avoid this scenario, parliamentarians from all parties must find a compromise that can command a majority in the House of Commons.”
Mike Watkins, head of retailer and business insight at Nielsen UK, said: "The upwards pressure on pricing continues across food retailing, and a key driver this month was inflation in ambient food and drink.
With shoppers looking to stretch their budget for the weekly grocery shop, this will not help volume growth, which has been slowing since the start of the year.
“For many high-street fashion, home and outdoor retailers prices are not increasing, so good news for shoppers as the end-of-season ranges sell through."