Food price inflation rises to nine-month high, according to BRC

According to figures from the British Retail Consortium (BRC) - Nielsen Shop Price Index, the 0.6% percentage point rise in food inflation was driven by the increase in commodity prices earlier in the year continuing to filter through.

The rising food prices are not expected to put many shoppers off buying their Christmas dinner, however, as supermarkets battle for market share over the festive period by keeping prices down. The Index also does not take promotions into account, so shoppers will experience a lower rate of inflation than headline figures suggest.

Overall shop price inflation stayed flat at 1.5%.

Non-food prices fell 0.3%, hitting a four-month low last month and delivering the ninth month of lower prices year on year driven by clothing and electrical goods.

BRC director general Stephen Robertson said: “Costs for commodities such as wheat and corn have eased off since peaking earlier in the year but these pressures, coupled with the impact of poor harvests, are continuing to filter through to fresh foods, with meat, fish and vegetables hit particularly hard. 

“This needn’t mean that turkey or trimmings are off the menu this Christmas. The fierce competition to secure Christmas spending should shield customers from the full impact of rising costs and ensure that they still get a good deal on seasonal fare.”

Fresh food prices rose the sharpest to 4.6% in November from 3.85% in October with prices jumping across vegetables, fish and meat. Meat prices have advanced as a result of a sharp rise in animal feed prices, which are 74% up against last year, while vegetables were affected by adverse weather conditions earlier this year.

Ambient food inflation edged up to 4.5% in November from 4.2% in October, as the pass through of commodity prices has been slower due to a longer supply chain.

In non-food, deflation in clothing and footwear stayed at 3.8% for the second consecutive month, with downward pressure coming from accessories and men’s clothing. Deflation in the electricals category remained at 4.1% for the second consecutive month.

Nielsen senior manager of retailer services Mike Watkins said: “With Christmas trading under way, non-food retailers are already discounting in order to drive footfall and supermarket retailers will be concerned about the inflationary pressures that are building, and whether this impacts the motivation of the already cautious consumer.”