It’s not just the United Kingdom, but as we await the latest figures from monthly U.S. data, the statistics from the U.K. are hitting the newswires. According to Reuters, food inflation in the U.K. is currently 17.1% . The primary driver of the skyrocketing food costs is the energy cost associated with the fast turnover categories.
With prices increasing 17.1% yet net sales only increasing 8.1%, there is a substantial impact in unit food sales. British customers are buying much less to offset the fact they are paying much more. This trend is not just in the U.K. we have seen the same trend in U.S. data as families are being squeezed at the grocery store.
The prices on name branded products like Kraft and Heinz are leading the escalating food prices. Just last week I noticed 6oz Kraft Philadelphia cream cheese was $6.99, and a 24 oz. bottle of Heinz ketchup at over $8. Dairy products are leading the way with the most rapid increases in price. It appears that we are entering the fourth wave of food inflation currently.
LONDON, Feb 28 (Reuters) – British grocery inflation hit 17.1% in the four weeks to Feb. 19, another record high, dealing the latest blow to consumers struggling with a cost-of-living crisis, industry data showed on Tuesday.
Market researcher Kantar said prices are rising fastest in markets such as milk, eggs and margarine. It said UK households now face an additional 811 pounds ($978) on their annual shopping bills if they don’t change their behaviour to cut costs.
“This February marks a full year since monthly grocery inflation climbed above 4%. This is having a big impact on people’s lives,” Fraser McKevitt, head of retail and consumer insight at Kantar, said.
He said its research found that rising grocery prices are the second most important financial issue for the public behind energy costs. Also a quarter of people say they’re struggling financially, versus one in five this time last year.
[…] Kantar said that sales of own label products were up by 13.2% in February, well ahead of growth in branded products, which are generally more expensive, of 4.6%.
Kantar said UK grocery sales increased 8.1% over the 12 weeks to Feb. 19, masking a drop in volumes when accounting for inflation. (read more)
The last estimate for U.S. data (January ’23) is in the chart below. We should get the February data the first week in March.
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