Cost of Living: Pace of food inflation to accelerate over summer and persist, industry body warns | Business News

A food industry research body has warned that grocery inflation is due to accelerate over the summer, with higher prices expected to persist to mid 2023.

The Institute of Grocery Distribution (IGD) saw a peak for food inflation of 15% in the coming months led by meat, cereal, dairy, fruit and vegetable products.

The study predicted that the average monthly spend on groceries for a typical family of four would reach £439 in January next year – up from £396 on the same month in 2022.

The result, it said, would be a rise in already-evident “food stress” among the worst off because of the wider cost of living crisis.

Meats which rely on wheat for food, such as poultry, were already seeing some of the largest leaps in cost, it reported, because of the surge in global wheat prices caused by Russia’s war in Ukraine.

It also highlighted effects from COVID-related supply chain disruption and Brexit.

The latest official figures from the Office for National Statistics (ONS) put the pace of grocery inflation at just shy of 7%.

The report was released amid growing evidence that shoppers’ food spending habits are changing rapidly in the face of a broad rise in the cost of living.

The last available measure for the rate of inflation came in April and stands at a 40-year high.

While food has contributed to rising household bills, it was the unprecedented rise in the energy price cap that month that was mostly responsible for the latest figure.

The Bank of England expects inflation to top 10% later this year when the next rise, expected to add more than £800 to a typical annual gas and electricity bill, takes effect in October.

Fuel costs are also hitting new records – daily in recent weeks.

IGD chief economist James Walton said: “From our research, we’re unlikely to see the cost of living pressures easing anytime soon.

“We are already seeing households skipping meals – a clear indictor of food stress.”