Another jump in food and drink inflation for March
19 April 2023
Food and drink annual inflation in March accelerated to 19.2% from 18.2% in February despite a drop in CPI to slightly above 10%, according to the Office for National Statistics.
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The decline was mainly driven by fuel prices and heating costs but this was offset by steeply increasing food and drink prices.
Chancellor Jeremy Hunt has said we are on track to continue driving down inflation to “ease pressure on families and businesses”.
The FDF’s chief executive Karen Betts said:
“Today’s food and drink inflation figures come as a disappointment to households up and down the country as the cost of the weekly shop continues to rise.
“Food and drink price inflation remains stubbornly high because it takes some months for the rising prices that manufacturers pay to produce food and drink to filter through into the prices that shoppers pay on high streets and in supermarkets. And, while we have seen some ingredient and production costs start to come down from the exceptional peaks of recent months, those declines have not been consistent across the board. Meanwhile, many of the underlying drivers of inflation are still in play – with, for example, energy costs still double what they were in 2019 and rising labour costs.
“Food and drink manufacturers know we have a responsibility to keep the price of everyday products affordable, and ONS data shows that over 80% are absorbing a proportion of rising input costs in order to shield shoppers from the full price rise. This is having an impact on business margins and the resilience of our sector. A drop in investment is flowing from this and points to a worrying economic trend.
“A competitive food and drink sector can help drive down inflation and power the UK’s economic recovery from a difficult period – but to do this, a renewed and ambitious partnership with Government on how we tackle skills and labour shortages, and how smart regulation can improve our sector’s ability to put more recycled materials into new packaging without inflating costs to consumers, will be critical.”