Food prices rise by a fifth in just 12 months

As in previous months oils and fats led the way, rising almost 50% year-on-year. Prices in the milk, cheese and eggs category fell slightly in the month, but still increased by more than 30% compared to October 2021.

“The coming months will be extremely tough for hospitality operators,” says Shaun Allen, Prestige Purchasing CEO.

“They will be caught in the squeeze between rapidly rising costs of operation, and diners seeing even more value as a result of the cost-of-living crisis. Riding out this storm requires investment in supply chain management, as in the hands of skilled professionals price increases can and should be avoided and mitigated.”

Only one category within the Index is not in double digit-inflation, with sugar, jams and syrups the outlier at 9.6%. Core products for hospitality such as meat, fish, vegetables and fruit are now all in the 16%-to-19% range year-on-year. Food in total climbed a further 1.3% month-on-month during October and is now running at 21% inflation year-on-year.

There were some signs during October that price-influencing factors occurring upstream of delivery are beginning to normalise, with oil prices, exchange rates and commodity markets all showing increasing stability.

“Soaring costs are making trading exceptionally challenging across the supply chain, and eye-watering inflation in several key categories will hit sales and margins again over the crucial Christmas season,” notes James Ashurst, client director at CGA by NielsenIQ.

“While it’s encouraging to see some signs of inflationary respite as we move into 2023, it is clear that our sector needs targeted government support to get through these unprecedented challenges.”