Brands that can demonstrate they are delivering value for money are set to do well following the latest food inflation figures.
This may be the news that Aldi and the other discounters have been waiting for or have Tesco and Asda destroyed their USP.
The British Retail Consortium said on Wednesday that shop price inflation rose to its highest annual rate since January last month. The Daily Mail reported that the cost of feeding a family has soared £230 in a year and criticised supermarkets for profiting.
Reuters reported: that the rise was due partly to surging wheat prices which helped push food price inflation to a 16-month high.
The BRC said shop price inflation rose to 2.1% in October from 1.9% in September, as past rises in commodity prices filtered through despite competitive pressures.
Britain’s official CPI rate held steady at 3.1% in September, well above the Bank’s target. CPI includes a wider range of items than the BRC index, such as fuel, utilities and services.
The BRC said inflation was particularly sharp in the food sector last month, where it rose to 4.4% from 4.0% in September.
“Wheat is up 47% compared with a year ago, affecting the price of staples such as bread and some meat products, as feed costs work their way up the supply chain,” said BRC director general Stephen Robertson. “Weak consumer confidence and a sluggish housing market mean retailers are competing even more fiercely for the limited discretionary spending available,” Robertson said.