UK grocery prices rose at their fastest pace in 15 years, according the most recent data from a closely watched survey, in contrast to latest official figures that suggested food inflation was slowing down.
Annual food prices rose 17.1 per cent in the four weeks to February 19, research firm Kantar said on Tuesday, the highest figure on record since the monthly survey began in 2008.
“Grocery price inflation is the second most important financial issue for the public behind energy costs, with two-thirds of people concerned by food and drink prices,” said Fraser McKevitt, head of retail and consumer insight at Kantar.
Food inflation a year earlier was running at 4.3 per cent, according to Kantar. It said the latest jump in prices would add £811 to the average British household’s yearly shopping bill. “This is having a big impact on people’s lives,” McKevitt added.
The latest Kantar data contrasts with official figures that showed a slight fall in food and non-alcoholic drink inflation in January, down 0.1 points to 16.7 per cent compared with a month earlier but still close to the highest level since Office for National Statistics records began in 1988.
Headline inflation slowed to a five-month low of 10.1 per cent in January, retreating further away from its 41-year peak in October, according to the ONS. Official inflation data for February will be released on March 22.
Kantar research showed that shoppers have been shunning branded products in an effort to save, with sales of supermarkets’ own labels increasing 13.2 per cent this month, in “a trend that shows little sign of stopping”, said McKevitt.
The discount supermarkets continued to benefit as shoppers become more price sensitive, with Aldi and Lidl both boosting their sales more than 20 per cent year on year. The two chains market share rose to 16.5 per cent, up from 14.1 per cent a year earlier, according to Kantar.
Less affluent households will be hit hardest by steep price rises at supermarkets with the poorest 10 per cent spending nearly a fifth of their weekly income on food, according to the ONS.
McKevitt said he expected the recent rationing of salad vegetables by five out of the six biggest supermarkets was “unlikely to drastically affect consumers” as they tend to buy fruit and veg in smaller quantities than the upper limit set by retailers.
Source: Economy - ft.com
