There remains however a marked contrast between FPI and the measure of supermarket pricing (CPI) which is now rising at roughly half the rate (8.5%) year-on-year. October also marked the first month-on-month fall in FPI since September 2021.
In October, FPI saw just one category (Oils & Fats) perform below 10% inflation at 4.0%, but this was in stark contrast to Vegetables where inflation remained extremely high at 30%. Overall, inflation within FPI has fallen 6.2% pts since its peak of 22.9% [YOY] in December 2022.
The UN FAO Food Commodity Index (the overall measure of international food commodity prices) averaged 120.6 points in October, down 0.7 points (0.5 percent) from September, continuing the downward trend and standing 14.8 points (10.9 percent) below its corresponding value a year ago. Brent Crude has eased after a September spike in price. Further inflationary pressure may be felt in the months ahead because the Sterling has been weaker since the summer against both the $ and the €, whilst UK wage inflation remains around 8%, acting as a brake on the rate of inflation reduction.
Shaun Allen, Prestige Purchasing CEO, said: “The Foodservice Price Index has risen by 40% over the past 24 months, and with inflation still at 16.7% the compound effects of these continued high numbers need to be carefully monitored and managed. As of today, the journey down to normal levels of inflation (about 1% to 3%) is only about one-third complete.”
James Ashurst, client director at CGA by NIQ, said: “The downward movement in foodservice price inflation is starting to build momentum, and we can be optimistic that pressures will ease further for businesses and consumers alike in 2024. Nevertheless, rates remain very high and continue to put strain on prices and profits. The long-term outlook for those in the foodservice chain remains good, but we are not out of the woods yet.”
The exclusive Foodservice Price Index is jointly produced by Prestige Purchasing and CGA by NIQ, using foodservice data drawn from 7.8m transactions per month. It contains myriad insights and information pertinent to the foodservice sector and is essential reading for anyone seeking to keep ahead of price trends and understand why they occur. More information on specific categories is available on a subscription basis.
For further information, contact Prestige Purchasing on 01908 222678 or stuart.read@prestige-purchasing.com.
Visit the new Foodservice Price Index Digital Portal. The new online hub gives users on-demand access to accurate pricing data, with an array of features to interpret trends and improve decision-making. Find out more: https://prestige-purchasing.com/foodservice-price-index-fpi/
