One of the main reasons February’s inflation reading was so high was down to food prices going up. Supermarket prices are continuing to soar with food inflation reaching a 45 year high at 18.2 per cent, leaving consumers to dig deep in their purses when doing the weekly food shop.
There are several factors to blame including a widespread vegetable and egg shortage as well as high energy costs and bad weather leading to rationing.
So when will consumers finally see prices coming down – or at least stop rising?
What is causing rising food inflation?
Last month’s vegetable shortage led to supermarket chains limiting the number of products people could buy, increasing prices.
Tomatoes, peppers and cucumbers were among the items affected last month with extreme weather in Spain and North Africa damaging harvests.
Energy prices have also been an ongoing factor, with rising wholesale costs meaning it has been more expensive for manufacturers to store and package items. Other foods require a lot of heat to grow, for example, tomatoes in greenhouses.
Eggs, in particular, have been a factor in rising inflation as there has been a significant drop in availability, thanks to avian flu and the increase in cost of chicken feed.
Avian flu has resulted in the deaths of over 43million hens, leading to nearly a billion less eggs being produced in 2022 when compared to 2019.
The Ukraine war is also continuing to have an impact, blocking the amount of supplies that are able to be exported.
Minette Batters, the President of National Farmers Union, said farmers have long been asking the Government to help and to make farming a critical industry which means it is considered essential by for the functioning of a society and economy and deserving of special protection for national security.
“Without collaboration between the Government and retailers, working to drive down cost for farmers and growers, nothing will happen.
“If things don’t change, we will have the lowest level of tomato production since 1945.”
She points to the high cost of energy, labour and fuel increasing pressure on farmers who haven’t been able to pass costs on to buyers as they mostly operate on fixed price contracts.
“This is a different model to Europe which works on a more supply and demand basis. There are weekly and monthly cost changes to take into account what is happening in the industry.
“We don’t operate like this is in the UK and farmers have had no help with energy costs. This combined with weather events in Morocco and Spain have led to rationing of items. It’s a perfect storm.”
Helen Dickinson OBE, Chief Executive of the British Retail Consortium, added: “The energy crisis, caused by the war in Ukraine, has pushed up gas and electricity bills for producers, retailers and households.
“Food remained one of the strongest contributors to overall inflation as the high price of animal feed and fertiliser has driven up the price of many staples, while the weaker pound made importing products such as vegetables from Europe more expensive.”
However, some have said inflation could have been skewed by the fact the figures were calculated on Valentine’s Day – traditionally a time when more people are spending on meals out, food and alcohol.
As a result, it may be that food inflation falls again in March.
When will it stop?
While it is not yet known exactly what will happen in the future, unfortunately it seems that prices will continue rising in the foreseeable future, despite the fact inflation is expected to decrease.
Alistair McQueen, head of savings and retirement at Aviva said: “All commentators are expecting energy prices to ease through 2023, which should also ease the upward pressure on food prices.
“Unfortunately, however, easing food inflation does not mean easing prices. It simply means the pace at which these prices are rising should begin to slow. High food prices look set to remain. The cost of living ‘crisis’ that we witnessed in 2022 may be passing. But there remains a cost of living ‘challenge’. The need for careful budgeting is greater than ever.”
Dickinson added: “While inflation is expected subside later this year, prices are likely to remain elevated as the higher costs throughout supply chains become baked in.
“Retailers are committed to doing everything they can to keep the price of essentials low through expanding value ranges and offering discounts for vulnerable groups. Against this backdrop, Government must do more to limit one of the biggest drags to retail investment, which is oncoming regulatory burdens heading down the track, or risk a crash in business investment and further inflationary pressures.”
Is there anything you can do to mitigate the hikes?
You could shop at cheaper retailers such as Aldi and Lidl, who are often voted the best value supermarkets in the country.
It is also worth making the most of loyalty cards. Tesco Clubcard is one of the best, giving cardholders exclusive discounts on a range of products as well as allowing them to accrue vouchers through spending which can be used in a variety of places including restaurants, cinemas and on holiday. Tesco Clubcard deals change each. For example, this week, cardholders can get extra large Easter eggs for just £3.50 while normal shoppers will pay £5.
A pack of eight Pepsi cans would cost non-cardholders £4 each but Clubcard users can get two packs for £6 instead, a saving of £2.
Being organised helps, too. Have a meal plan and shop online to avoid impulsive purchases. Batch cooking – cooking several meals at one go – is cheaper than cooking those meals individually.
There are many websites you can use to find batch cooking websites including BBC Good Food, The Batch Lady and Pinch of Nom.
Another top tip is to shop frozen not fresh. Often frozen vegetables and fruit will be much cheaper than their fresh alternatives.
Data from Which? shows that often frozen vegetables can be cheaper, for example, frozen broccoli cost between 19p to 25p per 100g for fresh and 11p to 21p for frozen – a difference of up to 8p per 100g.