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1 September 2022

Food inflation is higher than at any time since 2008

Fresh produce increased in cost by 10.5 per cent in the 12 months up to August.

By Katharine Swindells

The price of fresh food increased by more than 10 per cent in the year up to August 2022, according to data from the British Retail Consortium (BRC).

The BRC analysis shows that in August, overall shop prices saw annual inflation of 5.1 per cent. This rate is the highest since the trade organisation began collecting data in 2005. The cost of food is a huge component in the cost-of-living crisis, with annual consumer price inflation (CPI) hitting 10.1 per cent in July 2022 according to the Office for National Statistics (ONS).

Food has seen much higher rates of inflation in the past year than non-food, the BRC found, and it is still accelerating. Overall, food prices have increased by 9.3 per cent in the past year, the highest since August 2008.

Fresh food, especially animal products, are particularly affected by the rising prices in animal feed, fertiliser and energy costs. New Statesman analysis of the ONS's price indices found that the median price of two pints of semi-skimmed milk increased by 44 per cent between July 2021 and July 2022, a pat of butter increased by 32 per cent, and cheddar cheese by 31 per cent. Crisps and dry pasta have also seen annual rises of more than 50 per cent, driven by the rising costs of wheat and vegetable oil.

“Mounting cost pressures up and down supply chains meant shop price inflation hit a new high in August,” said Helen Dickinson, the BRC’s chief executive.

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“The situation is bleak for both consumers and retailers, but retail businesses will remain committed to supporting their customers through offering discounts to vulnerable groups, expanding value ranges, fixing prices of essentials and raising staff pay. However, as retailers also grapple with growing cost pressures, there is only so much they can shoulder.”

[See also: UK credit card borrowing rises at fastest rate since 2005]

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