UK supermarket giant Tesco is beginning to push its suppliers to cut prices as inflation starts to show signs of easing.

The UK’s largest supermarket, which has a dedicated team monitoring costs facing suppliers, is keen to start reducing prices on products for which it believes inflationary pressures have eased, according to The Sunday Times.

“Tesco is trying to lead the supermarket industry on deflation. They are asking for price reductions — but suppliers want price increases,” said The Retail Mind director Ged Futter.

In February, food inflation hit a 45-year high of 18%, well above the inflation rate of 10.4%.

Any changes in food input prices take months to work their way through to the shelf edge, but there are signs that the inflationary surge will finally abate in the coming months.

“The pressure on suppliers to decrease prices is going to come thick and fast,” said David Sables, head of supplier consultancy firm Sentinel Management Consultants.

“Supermarket buyers are flagging that they expect prices to be brought down, but it’s early days. Prices won’t drop in a straight line.”

In January, Tesco chair John Allan said it was “entirely possible” that food producers were taking advantage of those struggling as an excuse to increase prices.

The supermarket chain faced backlash last month for plans to introduce a supplier fee to help cover the rising costs of ecommerce.

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