The latest British Retail Consortium (BRC) figures show that food inflation in the UK has risen for the fourth consecutive month, driven by price rises in fresh produce and red meat such as steak.

Food inflation increased to 2.8% year-on-year in May, against growth of 2.6% in April. This is above the three-month average of 2.6%, while Fresh Food inflation increased to 2.4% year-on-year, against growth of 1.8% in the last month.

Meanwhile, the cost of non-food goods is falling. 

According to the data, shop price deflation was unchanged at 0.1% year-on-year in May, against a decline of 0.1% in April. This is above the three-month average of 0.2%. Non-Food deflation decreased to 1.5% year on year in May, against a decline of 1.4% in April. 

Increases in fresh food

Helen Dickinson, BRC chief executive, says, “While overall shop prices remain unchanged in May, food inflation rose for the fourth consecutive month. Fresh foods were the main driver, and red meat eaters may have noticed their steak got a little more expensive as wholesale beef prices increased.” 

She also points to an increase in UK government costs, which puts retailers under extra pressure, and warns consumers to expect a difficult period ahead. 

“With retailers now absorbing the additional £5 billion (US$X billion) in costs from April’s increased Employer National Insurance contributions and National Living Wage, it’s no surprise that inflation is rearing its head once again.” 

“Later this year, retailers face another £2 billion (US$X billion) in costs from the new packaging tax, and there are further employment costs on the horizon from the implementation of the Employment Rights Bill.”

“The government must ensure the Employment Rights Bill is fit for the purpose of supporting workers’ rights while protecting jobs and investment for growth. If statutory costs continue to rise for retailers, households will have to brace themselves for more difficult times ahead as prices rise faster.”

Ambient Food inflation decreased to 3.3% year on year in May, against growth of 3.7% in April. Outside of F&B, Non-Food deflation decreased to 1.5% year on year in May, against a decline of 1.4% in April.