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UK food inflation up on the back of commodity rises
12.05.2010 13:41 "Agro Perspectiva" (Kyiv) —
Food inflation in the UK rose to 2% in April from 1.2% in March according to the BRC-Nielsen Shop Price Index for April 2010.
The figures, which show the percentage change on a year ago and cover the period from 16 to 23 April, are said to follow the lowest inflation for three years.
Stephen Robertson, British Retail Consortium director general, said: "Rising costs edged overall shop price inflation up, but it’s still below the rates seen in December and January.
"With commodity prices, including oil and cocoa going up, food prices were almost bound to rise when compared with last month’s three-year low.
«Even so, food inflation is a quarter of what it was this time last year while some produce — milk, cheese and eggs — is actually cheaper than 2009.»
VAT is also higher than a year ago, however Robertson said that the main effects of rising costs and the weak pound had now been felt.
He added: «With demand still weak, shop prices should be more stable in future months as long as there are no more big shocks.»
Overall shop price inflation rose to 2% in April from 1.2% in March
Mike Watkins, senior manager, retailer services, Nielsen said: "The Shop Price Index this month reflects the end of some seasonal and Easter discounts and, for food retailers, this also comes after the lowest inflation for three years.
"Whilst some inflationary cost price pressure remains in the background in particular for food, we still have a low growth environment.
«Retailers across all channels continue to rely on promotions, deep discounts and a range of initiatives to drive loyalty and sales as shopper demand remains unpredictable.»
Meanwhile statistics from the Organisation for Economic Co-operation and Development (OECD) show that UK food prices rose more quickly than most other countries in March.
The figures show that across the European Union as a whole, March 2010 food CPI was -0.2% but in the UK it was 2%, compared to the same month of the previous year.
In France it was 0.5%, in Ireland -7.8%, the Netherlands -1.4% and in Germany 0.1%.
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