UK food inflation eases, thanks to falling prices for butter and coffee

03 Jul 2024 --- According to new figures from the British Retail Consortium (BRC), food inflation rates decelerated to 2.5% in June, down from 3.2% in May. This is below the three-month average rate of 3.0% and is the fourteenth consecutive deceleration in the food category. Inflation is its lowest since December 2021.

Fresh Food inflation slowed further in June to 1.5%, down from 2.0% in May. This is below the three-month average rate of 1.9%, and it is at its lowest since November 2021.

Meanwhile, Ambient Food inflation decelerated to 3.9% in June, down from 4.8% in May. This is below the three-month average rate of 4.5% and is the lowest since April 2022, reveals the BRC. 

Cutting costs 
Helen Dickinson, BRC chief executive, says: “During the height of the cost of living crisis, retailers invested heavily in improving their operations and supply chains to compensate for the impact of global shocks on input costs. This is clearly paying off, with shop prices having risen just 0.2% over the past 12 months.”

“Food inflation is now lower than any time since 2021 helped by falling prices for key products such as butter and coffee,” she notes.

Retail inflation 
Dickinson reflects that “whoever wins Thursday’s election will benefit from retailers’ efforts to cut costs and prices, easing the cost of living for millions of households.” 

“The last few years should serve as a warning that where business costs rise significantly, consumer prices are forced up too,” she continues. “The next government must address some of the major cost burdens weighing down the retail industry, including the broken business rates system and inflexible apprenticeship levy. By doing so, retailers can invest in lower prices for the future — helping to reduce the cost of living pressures that many families face.”