Food inflation to accelerate towards Christmas, BRC says

Food price inflation
Food price inflation accelerated in the first week of October

New research has found that food price inflation accelerated in the first week of October compared to September.

The BRC-Nielsen IQ shop price index recorded food inflation as 0.5 per cent in the first week of October, up from 0.1 per cent in September.

This compares to year-on-year figures which show deflation of -0.7 per cent and -0.6 per cent respectively.

READ MORE: Over half of Brits experiencing food shortages

“While overall prices remain below their October 2020 levels, this is the third consecutive month of both food and non-food month-on-month rises,” BRC chief executive Helen Dickinson said.

“October food prices saw the highest rate of year-on-year inflation since November 2020, with fresh food prices rising for the first time in ten months.

“Tight margins mean retailers may not be able to absorb all of these new costs, so prices will continue to rise.

“A BRC survey showed three in five retailers expect prices to increase in the run up to Christmas, and the ongoing labour shortages are making the situation worse.

“Retailers continue to do all they can ensure value for money for customers and are looking to work with government to find a long-term solution to these shortages, otherwise it is the British consumer, who already face higher energy bills this winter, who will suffer the consequences.”

NielsenIQ head of retail and business insight, Mike Watkins said: “With food prices slowly increasing we can expect shoppers to start to rebalance basket spend over the next few weeks, particularly with increased concerns about discretionary spend.

“And with consumer sentiment now more cautious we cannot ignore that availability issues are still top of mind.

“So consumers will be uncertain about when and where to spend and with Christmas promotions about to kick in, competition will intensify in both food and non-food retailing.”

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