The latest edition of the CGA Prestige Foodservice Price Index – published today – reveals that in some categories actual prices are starting to come down slightly compared with previous months, although in other key sectors the trend is still up.
Inflation in wholesale foodservice prices fell in July 2017, welcome news to the UK’s eating out operators who have experienced unprecedented food price inflation over the past 12 months.
This month’s Foodservice Price Index, produced by CGA and Prestige Foodservice, reveals that food inflation hit 7% in the 12 months to July 2017, down from its previous level of 8.8% in June 2017 and 9% in May.
But while some food prices are coming down, this inflationary fall can also be attributed to the higher monthly comparables of 2016, when the post-Brexit months saw prices rise rapidly as the value of the pound fell sharply against the euro.
One bright spot seen in this month’s FPI is in the price of sugar and cocoa, which has seen year-on-year deflation of 6.8% as prices for key ingredients in this category have fallen. Fruit inflation has also seen a healthy decrease to 8.95% for July, down from 13.6% in June due to a brief dip in prices.
Other key food categories such as fish, meats, and oils and fats are still seeing price rises year on year due to supply and labour issues in producing countries.
Oils and fats saw the highest price inflation for July, at 12.4%, due to harvest issues for olive oil in the newer producing countries, while meat price inflation saw double digit rises in July as compared to the previous year, up to 11.4%.
The price of wholesale milk, cheese and eggs has also risen slightly this month, up to a year-on-year inflation figure of 10.6% for July.
Christopher Clare, head of consulting and insight at Prestige Purchasing, commented: “While the Index shows that overall the price inflation figures appear to have calmed, this is somewhat due to the high comparables of last year. However, there are still a number of crucial supply issues that could force up prices further in many key categories.”
“The weakened value of the pound is inevitably having a profound impact on wholesale prices in the UK and in some categories, such as vegetables, the threat of insufficient migrant labour is already threatening to constrain domestic supplies,” added Graeme Loudon, commercial director at CGA.
The CGA Prestige Foodservice Price Index is jointly produced by Prestige Purchasing and CGA, using data drawn from over 50% of the foodservice market and around 7.8 million transactions per month.