It means inflation has now fallen for 13 consecutive months, bringing respite to businesses and consumers who have faced historically high prices across food and drink. However, the report also indicates a slight uptick in month-on-month prices, with the whole basket of items increasing by 0.2% from June. The rise was largely driven by the beverage categories of the Foodservice Price Index, which have consistently risen since March this year, contributing to year-on-year inflation of 7.3% in the Mineral Waters, Soft Drinks & Juices segment, and 4.7% in the Tea, Coffee & Cocoa category.
On the food side, two of the Index’s eight categories recorded a year-on-year decrease in July, with Dairy and Oils & Fats down by -0.1% and -1.7% respectively. In contrast, the Vegetables and Sugar, Jam, Syrups & Chocolate categories saw sharp rises of 9.6% and 8.4% respectively.
High inflation in the Vegetables category is predominantly driven by potato pricing. Reports suggest that English white potatoes are currently up around 90% year-on-year as a result of 2023’s challenging harvest. However, if the 2024 harvest progresses without climatic interruptions, price spikes are unlikely to repeat.
Shaun Allen, Prestige Purchasing CEO, commented: “The sustained year-on-year decline in foodservice inflation is encouraging, but the slight month-on-month increase and the significant inflation in certain categories, particularly beverages and vegetables, remind us that the journey towards price stability is ongoing. Operators should remain vigilant and proactively manage their procurement strategies to navigate the fluctuating market conditions.”
Reuben Pullan, senior insight consultant at CGA by NIQ, said: “After two years of relentless price rises, this further drop in inflation brings more relief to hospitality venues and consumers alike. With energy costs easing too, the tight squeeze on operators’ margins and people’s spending may finally be loosening. However, while businesses can now plan with greater certainty, macroeconomic challenges and pressures in key areas of food and drink mean there is no room for complacency.”
Reuben Pullan, senior insight consultant at CGA by NIQ, said: “After two years of relentless price rises, this further drop in inflation brings more relief to hospitality venues and consumers alike. With energy costs easing too, the tight squeeze on operators’ margins and people’s spending may finally be loosening. However, while businesses can now plan with greater certainty, macroeconomic challenges and pressures in key areas of food and drink mean there is no room for complacency.”
The exclusive Foodservice Price Index is jointly produced by Prestige Purchasing and CGA by NIQ, using foodservice data drawn from 10.7m 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/
