‘Significant' inflation seen in fish, dairy, soft drinks, oils & fats
Eight of the ten categories in the FPI have experienced inflation.
Prestige Purchasing found that eight of the ten categories have experienced inflation this month, with ‘significant’ movements for Dairy, Soft Drinks, Oils & Fats, and Fish. Two of the ten categories in FPI have experienced deflation.
Among the top movers, fish has experienced the most significant year on year inflation in FPI, maintaining its upward position on last year. Prestige Purchasing forecasted the inflation to continue in the long-term as quota reductions for white fish keep prices at high rates, and with no sign of total allowable catches going up. However, fish has dropped on last month, as good availability of salmon is keeping prices low.
Year on year inflation on Oils & Fats, meanwhile, was recorded to be lower than the recent past, and month on month the movements have been deflationary. A significant impact to the Oils & Fats market has been a decrease in crude oil pricing since late 2018 and strengthening of the pound against the euro and dollar.
Citing higher production costs in light of feed shortages following last year's summer, dairy has experienced high year on year inflation. But despite being high compared with last year,dDairy has experienced monthly deflation primarily as a result of increased production due to healthy grass growth for use as silage following good rains, reducing the requirement on expensive feed. Prestige sees milk production to increase for this year, but as demand is expected to remain stronger, prices could increase into later in the year as well.
Soft drinks are sustaining the general upward trend it has held since the Food & Beverage Index began and has now reached its highest point to date. Much of the rise was attributed to a shift away from alcohol consumption, reformulation of products, and increasing varieties of adult soft drinks.
