Supermarket bosses have said they do not expect food prices to fall next year, suggesting that inflation will persist through 2024.
According to a report in The Times, Sainsbury’s chief executive Simon Roberts stated last week that he did not expect the industry to move into deflationary territory next year, citing rising wages and high energy costs.
The management of Iceland, the frozen food chain, told investors last week that it expected food price inflation of 4-6 per cent at the end of its financial year in March.
The national living wage, which acts as a reference point for pay up and down the food supply chain, is forecast to rise above £11 an hour in April, up from its current £10.42. Labour costs are typically the biggest factor in food price inflation.
Roberts stressed that inflation was consistently falling.
“It is our priority to make sure we are passing on savings to customers … we’ll continue cutting prices wherever we can,” he said.
Outgoing Morrisons boss, David Potts, has also said that while the worst of food inflation is over, yet he warned that vegetable lines were likely to surge in price ahead of Christmas.
Food inflation is proving to be among the more stubborn inflationary pressures. Inflation, measured by the consumer prices index, peaked at 11.1 per cent in October last year. Food inflation hit its peak of 19.1 per cent in March, falling to 12.1 per cent in September.
The Bank of England expects inflation to have fallen to 4.8 per cent in October because of changes to the energy price cap. It said food inflation should be 9 per cent in the past three months of this year and 5 per cent in the first three months of next year.
Britain's annual inflation rate unexpectedly fell to 2.5 per cent last month, official data showed Wednesday, easing some pressure on the Labour government faced with economic unrest.
Analysts had forecast no change in the Consumer Prices Index (CPI) from the 2.6 percent figure in November.
The latest reading from the Office for National Statistics (ONS) comes one day after chancellor Rachel Reeves was forced to defend the government's handling of the economy following a recent sharp runup in state borrowing costs and a hefty drop in the pound.
"Inflation eased very slightly as hotel prices dipped" after rising in December 2023, noted Grant Fitzner, chief ONS economist.
"The cost of tobacco was another downward driver, as prices increased" less than a year earlier, he added.
"This was partly offset by the cost of fuel and also second-hand cars, which saw their first annual growth since July 2023," Fitzner said in the release.
Wednesday's data showed also that on a monthly basis, CPI rose 0.3 percent in December, down from 0.4 percent a year earlier.
The ONS added that core CPI - excluding energy, food, alcohol and tobacco - increased by 3.2 percent in the 12 months to December, down from 3.5 percent in November.
Reeves told parliament Tuesday that the government needed to "go further and faster" in its bid to kickstart economic growth in the face of UK markets turmoil.
The chancellor of the exchequer, in the role for just over six months following Labour's election win, faced a renewed call to resign by the main opposition Conservative party during a heated exchange.
Prime Minister Keir Starmer has given his full backing to Reeves.
UK 10-year bond yields, a key indicator of market confidence, reached last week the highest level since the 2008 global financial crisis.
That puts fiscal pressure on the government and could force it to cut spending and further hike taxes.
Reeves' maiden budget in October included tax rises for businesses - a decision blamed for Britain struggling to grow its economy in recent months.
Swiss chocolate maker Lindt & Spruengli announced Tuesday that it would raise prices again in 2025 after strong sales last year showed that increases had not cut the appetite of consumers.
The group had already hiked prices by "mid-single" digits last year to offset the rising costs of cocoa.
"The cocoa market was volatile in the reporting year, with cocoa prices remaining at a historic high by the end of 2024," Lindt said in a statement.
"Offsetting the high cocoa costs forced the Group to adjust its pricing, which will be further required in 2025."
The company posted organic sales growth - which excludes currency fluctuations and acquisitions - of 7.8 percent in 2024 to 5.47 billion Swiss francs (£4.91 billion).
It was higher than the 5.45 billion francs expected by analysts surveyed by Swiss business news agency AWP.
Cocoa prices soared 161 per cent last year, reaching $10,100 (£8261) per tonne in mid-December before easing to $9,165 at the end of 2024.
Lindt said it expects organic growth of seven to nine percent in 2025 and an improved operating profit margin.
The Welsh government has published its consultation response on draft HFSS regulations, confirming its intention to bring the rules into force from Spring 2026.
The draft regulations, which closely follow those already in place in England, will introduce the following measures:
For retailers with more than 50 employees: Restrictions on the promotions of multibuys (for example 3 for 2) and additional volume (for example 50% extra free) of HFSS products
For retailers with more than 50 employees and relevant floor space over 2000 sq ft: Restrictions on the placement of HFSS products at the end of aisles, within 2m of checkouts and queueing areas, and near the entrance of a store (dependent on store size)
The Association of Convenience Stores (ACS) has welcomed the announcement, which means that retailers will have at least 12 months to prepare for the introduction of the rules, subject to approval in the Senedd.
“We welcome the Welsh government’s timetable for the introduction of HFSS measures to give retailers enough notice to make changes to their businesses,” ACS chief executive James Lowman said.
“The experience of the introduction of similar regulations in England has taught us that clear, detailed guidance is crucial in ensuring compliance and avoiding confusion for colleagues, customers, and retailers alike.”
As part of the announcement, the Welsh government have committed to publishing comprehensive guidance on the regulations, which will be made available to businesses and enforcement bodies ahead of the regulations coming into force.
Plans are well under way for the return of the Scottish Wholesale Association’s new-format Annual Conference, taking place in Aberdeen on Thursday, 5 June – and tickets are now on sale.
The event, which adopts a different format to the SWA’s previous well-attended weekend conferences, and this year moves out of the central belt to the north-east of Scotland, will focus on new trends and market insights in the wholesale industry with the wider theme centred around Kaizen, a Japanese business philosophy that focuses on continuous improvement.
Kaizen, meaning “change for the better”, will help the industry explore topics such as the importance of technology within wholesale, along with the use of data and AI (artificial intelligence) within the sector to bring efficiency and improved insights to wholesale operations.
Other discussions will explore DE&I (diversity, equity and inclusion) in the workplace, plus sustainability, creating value, and maintaining a competitive edge in an ever-changing and fast-moving wholesale industry.
Another key component of the one-day conference, which is being held at Ardoe House Hotel & Spa near the River Dee on the outskirts of Aberdeen, is an exhibition featuring some of Scotland’s finest produce, as part of the SWA’s commitment to a strong, resilient, local supply chain.
The exhibition will showcase food and drink producers which have participated in the SWA’s Delivering Growth Through Wholesale (DGTW) and Wholesale Local Food Champion programmes.
Colin Smith
“We’re ringing the changes with our new-format Annual Conference which returns for the first time since 2019," said SWA chief executive Colin Smith.
“As we strive to ensure that our Annual Conference remains relevant to members and suppliers – their time is at a premium so we must provide a platform for networking and create an environment that is conducive to encouraging discussion and sharing information – we will use Kaizen as the lens through which we will look to the future.
“What does a thriving Scottish wholesale channel look like, now and in the coming years, and what steps should we take to make it a reality? With the support of the renowned Kaizen Institute, our conference – which will feature a mix of speakers and panel discussions – will seek some of the answers.
“SWA members have told us how valuable networking opportunities like this are to their businesses as they provide a rare opportunity to catch up with their peers and meet new contacts in a relaxed environment.
“Space is limited so please secure your spot today and be part of an event that promises to inspire and empower.”
For those SWA members travelling to Aberdeen the day before, there is a pre-conference BBQ and networking evening in Ardoe’s stunning gardens, overlooking the River Dee, on Thursday, 4 June, which attendees can book as part of the conference package.
Family-run forecourt business AY&Y Patel Dewsbury Ltd has transformed its Ceylon service station in Rochdale with a £1.5 million complete knockdown rebuild.
Located in Yorkshire Street, the site has been in the family business for almost 35 years and now has an expanded brand-new SPAR store, serviced by James Hall & Co. Ltd, and a modernised Shell forecourt.
The four-month project has created a bright and airy SPAR store that belies its 1,230sq.ft. size. Highlights are a Fanta Frozen machine and chai and coffee units complementing a strong range of products across all categories with Food To Go including the SPAR Meal Deal.
The Shell forecourt features include six pumps, with V-Power fuel options, an air and water machine, ATM, and new signage.
Shaheena Patel, Operations Manager at AY&Y Patel Dewsbury Ltd, said, “Our Ceylon service station is something of a family favourite being one of our earliest sites and we are thrilled with the results of the rebuild.
“During the transformation, we removed the old car wash at the back of the site to increase the sales space in the new SPAR store which felt was the right direction to go. Visually the store is fantastic, and the range we have included utilises the space available to great effect.
“It is a similar story outside where we have maximised our compact forecourt with the number of pumps and services, also improving access in and around the forecourt for customers.
“Overall, we are delighted and are grateful for the support we have had from multiple departments at James Hall & Co. Ltd. Together we have set Ceylon service station up for a strong future.”
Peter Dodding, Sales Director at James Hall & Co. Ltd and Chair of the SPAR Northern Guild, said. “I am blown away by the changes at Ceylon service station and the Patel family should rightly be proud of what has been achieved at the site where space is at a premium.
“It is another shining example of an excellent working relationship between James Hall & Co. Ltd and AY&Y Patel Dewsbury Ltd, and there is no greater satisfaction for me than seeing our company support the development and growth of our independent SPAR retailers.”
James Hall & Co. Ltd is a fifth-generation family business which serves a network of independent SPAR retailers and company-owned SPAR stores across Northern England six days a week from its base at Bowland View in Preston.