UK Food Prices Surge as Retailers Face £7bn New Costs

Food costs have seen their fastest monthly increase since April last year, signalling what experts describe as an “early sign of what is to come”, according to latest figures.

The British Retail Consortium (BRC) reports that food prices rose by 0.5% between December and January, with ambient food experiencing a notable 1% increase driven by higher prices for sugary products, chocolates and alcohol.

Year-on-year food inflation stood at 1.6% in January, easing slightly from 1.8% in December, as shown in the BRC-NielsenIQ Shop Price Index.

BRC chief executive Helen Dickinson said: “Extensive January sales was good news for bargain hunters, with non-food products showing significant discounts, particularly for furniture and fashion, but less good news for retailers needing to shift excess stock.”

She warned: “Price cuts and deflation may not last much longer as retailers will soon feel the full impact of £7 billion of new costs announced at the last Budget.”

Mike Watkins from NielsenIQ added: “Shoppers continue to be unsure about spending and many are seeing a continued squeeze on their household incomes.” 🛒