good news for all the foodies out there! The latest data from the Office for National Statistics (ONS) shows that the annual inflation rate for food and non-alcoholic beverages dropped to 10.1% in October, down from 12.2% in the previous month. That’s a 0.1% increase in prices from September to October, which is much lower than the 2% hike during the same period last year.
And get this, the inflation rate has been on a downward trend since March, when it hit a whopping 19.2% – the highest in 45 years. The last time inflation was below 10% was back in June 2022. Looks like things are finally looking up for our grocery bills!
Karen Betts, the boss lady at the Food and Drink Federation (FDF), credits this positive trend to the drop in input costs and the efforts of food and drink manufacturers who’ve been working hard to protect us from the full impact of inflation. But here’s the catch – this has taken a toll on their profits, with margins hitting a 40-year low. Ouch!
While this is great news for us consumers, Betts is sounding the alarm for more investment in the food and drink manufacturing sector. She’s calling for urgent action, pointing out that investment in the industry has dropped by more than a third compared to four years ago. The government needs to step up and create better conditions for investment, and Betts thinks making full expensing permanent in the Autumn Statement could be a game-changer.
Ed Bignold, the big cheese at Alvarez & Marsal, reckons that the falling inflation rate is a boon for foodservice businesses as we head into December. He expects price growth to keep dropping in the coming months, but warns that businesses need to stay sharp and adaptable as higher prices start to squeeze household budgets.
On a different note, there’s some drama brewing at retail chain Iceland as one of their suppliers is facing a strike over a pay dispute. Looks like it’s not all smooth sailing in the food industry, but at least we’ve got some good news to chew on!
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