Coffee beans and ready meals surge in price as food inflation hits record high

Food inflation  Ashford, Kent, UK. 22nd Apr, 2023. Tesco quiche aisle. Photographer: Paul Lawrenson, Photo Credit: PAL News/Alamy Live News
Food inflation hits another record high as pressure mounts on home finances. Photo: Paul Lawrenson/PAL News/Alamy Live News

Food inflation hit a new high in the UK last month with items such as coffee and ready meals going up in price.

Food prices at British supermarkets rose 15.7% in the year to April — the biggest annual increase in records going back to 2005, according to the British Retail Consortium (BRC).

Helen Dickinson, chief executive of the BRC, said: "Overall shop price inflation eased slightly in April due to heavy spring discounting in clothing, footwear and furniture.

"However, food prices remained elevated given ongoing cost pressures throughout the supply chain.

"The knock-on effect from increased production and packaging costs meant that ready meals became more expensive and coffee prices were also up due to the high cost of coffee beans, as well as key producer nations exporting less.

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"Meanwhile, the price of butter and vegetable oils started to come down as retailers passed on cost savings from further up the supply chain."

Fresh food inflation, such as vegetables and fruits accelerated 17.8%, up from 17% in March, the highest inflation rate in the fresh food category on record.

Moreover, food inflation accelerated to 15.7% in April, up from 15% in March and ambient food, such as canned soups and vegetables soared to 12.9% in April, up from 12.4% in the previous month.

However, broader shop price annual inflation ticked down to 8.8% in April from 8.9% the month before amid Spring discounting. Nevertheless, it remains near record highs.

The latest figures come as the average price of food and non-alcoholic drinks in the UK has seen its sharpest increase in more than 45 years.

However, Dickinson added that shoppers "should start to see food prices come down in the coming months" amid reductions in wholesale prices and other costs.

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Victoria Scholar, head of investment at Interactive Investor, added: "While inflation remains elevated, there are incipient signs that price pressures are starting to cool. The hope is that food prices will come down in the months ahead, although it is more likely that price growth will just slow instead in the near-term as consumers continue to feel the squeeze from rising weekly food bills.

"The unfortunate nature of the type of inflation the UK is facing is that it is affecting essential items such as food, hitting those at the lower end of the income spectrum most acutely, particularly with real wage growth stuck in negative territory."

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