Food & non-alcoholic drink inflation climbs to 3.4%

Balwinder Dhoot, Director of Industry Growth and Sustainability, FDF said:

"We’re concerned to see food and non-alcoholic drink inflation climb again to 3.4% in April 2025. Food and drink manufacturers said they expect production costs to rise an average of 4.8% over the next 12 months as a result of rising energy and commodity prices alongside regulatory costs such as increases to National Insurance Contributions and a new £1.4bn packaging tax. We therefore forecast food and non-alcoholic drink inflation will average 4.3% over 2025.

“Businesses continue to work hard to protect shoppers from rising prices and safeguard the UK’s food security. It’s imperative that government reflects the importance of our sector to the UK economy and the nation’s food supply by making growth a top priority in its upcoming Food and Industrial strategies. An enhanced trading arrangement with the EU marks a positive step towards driving growth for UK businesses, and government should engage with industry to ensure this agreement represents their interests, as well as continuing to cut red tape to enable food manufacturers to invest in productivity.”

Background

• The ONS reports on 49 main categories which have seen a mixed performance. 
• There were six categories that saw inflation in double digits: butter (19.9%), edible offal (14.7%), chocolate (14.6%), lamb and goat (13.8%) beef and veal (12.2%), and cocoa and powdered chocolate (10.2%)
• We forecast that food and non-alcoholic drink inflation will average 4.3% over 2025 and could rise as high as 4.8% by December 2025
• Businesses expect production costs to rise on average 4.8% over the next 12 months to March 2026 (April 2025-March 2026): https://www.fdf.org.uk/fdf/resources/publications/state-of-industry-reports/state-of-industry-report-q1-2025/
• FDF’s Ingredients for Growth: Ingredients for Growth: Driving growth in food & drink manufacturing | The Food & Drink Federation