Oils, fats and fish driving inflation amid impending Brexit, report says
Fish imports have been affected by recent further declines in the value of the pound.
Oils, fats and fish continue to trade at prices over 25% higher than last year, according to the latest edition of the Foodservice Price Index from CGA and Prestige Purchasing.
Their Edible Oils & Fats index has reportedly risen every month since February and is now at "unprecedented levels", explaining that the rise has been driven by a huge surge in the price of butter over the past two years.
Meanwhile, fish imports have been affected by further declines in the value of the pound, and trade turbulence has been created in world markets by the imposition of a 10% tariff by the US on Chinese fish imports, which is pushing up demand and price in other countries.
The Index confirms that the possibility of a 'no-deal' Brexit is dominating buyers' risk agenda.
“We have seen a much higher level of volatility within some food supply markets this year, which once again is impacting margins for operators, who are already under pressure in this area. An EU withdrawal agreement that gives more certainty around future trade arrangements will do much to calm markets as we head towards 2019. In the meantime, it’s essential that operators take a proactive approach to management of future risks of inflation,” Shaun Allen, Chief Executive at Prestige Purchasing, explained.
Fiona Speakman, CGA Client Director for Food, added: “Steep inflation in the Oils & Fats and Fish categories in the latest edition of the Foodservice Price Index is another sign of the volatility experienced by the sector ever since the UK’s Referendum on leaving the EU. There are many other inflationary pressures beyond Brexit of course, but we see no sign of the turbulence easing as the date for leaving the EU draws nearer, and an anxious few months lie ahead as buyers await clarity on the terms of departure."
The CGA Prestige Foodservice Price Index is a joint production by Prestige Purchasing and CGA, using foodservice data drawn from 7.8m transactions per month.
