Food inflation in hospitality hit 15% in August: index

It is the seventh month of double digit inflation in a row.

Food and drink price costs rose 15% in August as the index kept recording double-digit inflation each month this year since February, CGA’s Foodservice Price Index showed.

Prices are increasing nearly 2% from July alone, read the report.

“Every category of the Index experienced year-on-year inflation, with two key segments—dairy and oils & fats—surpassing 4% month-on-month. Only two —fruit and sugars—registered a small fall in prices from July,” according to CGA.

The heat wave in the UK and the European Union brought severe impact on crops but conditions have improved in the recent weeks. 

With the energy pricing still facing uncertainty and the Russian-Ukraine conflict still not subsiding, the market may still be volatile for some time.

Prestige Purchasing CEO Shaun Allen said, “In the months ahead it is likely that we will reach peak inflation, then see some levelling-off, before a gradual fall during next year. But falling inflation does not mean that prices will go down. For at least the full year of 2023 we expect that they will just increase more slowly. With so many other pressures it would be easy for operators to take the eye off the ball of managing supply prices, which in this market could be very costly.”

James Ashurst, client director at CGA by NielsenIQ, said: “Inflation is having a severe impact on businesses and consumers alike, and foodservice is caught in the eye of a fierce storm. While some pressures may be easing, a tough winter lies ahead. The foodservice sector remains a vibrant contributor to the UK economy, but it deserves urgent, targeted and sustained government support to mitigate inflationary challenges and sustain vulnerable businesses.”