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Food prices up by nearly 5%

8th May 2008, 11:12am

New figures from the British Retail Consortium show that the cost of food and drink rose by 4.7% in April, almost doubling the current rate of inflation.

Compared with April last year, the rise is the result of increasing costs for wheat and milk.

The BRC's Director General, Stephen Robertson, said: "Food prices have gone up, but the retail price of food is rising much more slowly than the farmgate price of commodities such as wheat and milk. Retailers are succeeding at protecting customers from the full force of increasing commodity, energy and transport costs by absorbing most of those increases themselves, even when it's at the expense of their own margins. There is no doubt food prices would be much higher if it wasn't for retailers' efforts to contain them."

Mike Watkins, Senior Manager, Retailer Services, Nielsen comments: "The increased cost of living has a high profile at the moment so it is important to quantify that underlying shop price inflation across a wide range of items is still less than five per cent for food and actually in deflation for non-food. Whilst there is higher inflation in many dairy and cereal-based categories, shoppers continue to benefit from retailer competition and supply chain efficiencies which are keeping increases as low as possible for as long as possible."

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