Food Prices Sent UK Shop Price Inflation To New High: BRC

Hiking food prices sent annual inflation in British shops to its peak in at least 18 years in March, industry data showed on March 25. The British Retail Consortium said overall shop price inflation soared to 8.9% from 8.4% last month, the sharpest rise since the British Retail Consortium’s (BRC) records began in 2005.

Prices in the BRC’s food category were 15% higher than the year before, echoing official inflation data last week that showed food and drink prices increased in February at the fastest annual pace since 1977.

“Shop price inflation has yet to peak,” said BRC Chief Executive Helen Dickinson, who mentioned the increasing cost of sugar as a key driver of higher food prices in March.

Sugar prices have been affected by declining production, surging energy prices, and a pesticide ban in Britain to protect bees.

“Fruit and vegetable prices also rose as poor harvests in Europe and North Africa worsened availability, and imports became more expensive due to the weakening pound,” Dickinson said.

British supermarkets have struggled with a shortfall of key salad staples, especially tomatoes, peppers, and cucumbers after cold weather in growing areas.

The country’s annual consumer price inflation – which comprises services and other non-shop goods such as energy – surged unexpectedly to 10.4% last month. It reached a 41-year high of 11.1% in October.