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UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

grocerygazette.co.uk

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Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#201

Post by MrGilbert »

martinald wrote: post #182
samhuk wrote: post #167

As a person living in the UK, I have definitely noticed a considerable rise in unit prices. One of many examples is that a loaf of my favourite bread increased from £3 to £4 recently, which was a shocker. Toilet roll prices, as ever what the news loves to talk about, has exploded, increasing by around 70% since 2020 by my anecdotal observation. A sad thought I have about inflation is the fact that it is, wittingly or…

Assets are deflating at the moment though. S&P500 is down, property prices are down, etc. Asset prices are highly inversely correlated to interest rates, so for a 'rich' person you are actually much better off without inflation, as interest rates are lower and asset prices rise faster.

> "property prices are down, etc"

Well, idk about your area, but property prices in northern Germany are still well above the 2020 mark.

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#202

Post by pjc50 »

titzer wrote: post #116
simonh wrote: post #92

Earlier quoted context omitted.

If wholesale food costs have gone up and they're simply passing that on then they may not be making any more money. Here's wholesale food prices in the US: https://fred.stlouisfed.org/series/WPU578101 In fact you'd expect reduced sales from the higher prices to put pressure on profits. That is what seems to be happening in the UK: https://www.grocerygazette.co.uk/2023/01/31/food-companies-p... But not in the US, wher…

It's both increased wholesale food costs and price gouging. Profits have never been higher all along the board. Everyone in the chain is "passing the cost on" and also taking a little extra cut.

I've seen a convincing argument that this is energy price inflation being passed on down the pipe. Certainly for out-of-season foods grown in greenhouses, leading to the UK tomato shortage of last month. (Anyone else see "max 3 per customer" on various fresh fruit and veg?)

The profits are inarguable. They really have never been higher. https://tradingeconomics.com/united-kingdom/corporate-profit...

(note the table underneath pointing out that industrial production has declined at the same time as record profits)

Energy is a large part of that: https://www.bbc.co.uk/news/uk-64489147

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#203

Post by dazc »

dukeyukey wrote: post #169
hkt wrote: post #151

Yet another sector where investment is low and prices are high. Over winter tomatoes were in short supply, not because we couldn't grow them, but because the methods of heating greenhouses were too expensive. CO2 heaters use gas in largely uninsulated greenhouses. A bit of creativity (solar thermal with storage supplying radiators) or just modernity (air source heat pumps) would have solved this problem. Alas, there…

The UK has some of the cheapest food in the developed world, I'm surprised to hear anyone say they're high.

It is all relative I guess? I lived in Spain for a while and noticed how out of season produce was very expensive and there was very little of it. In the UK we expect to be able to buy everything all year round and cheap.

Nobody stops to think how that was possible but that doesn't prevent them moaning when Sainsbury's only have 12 varieties of tomato on the shelves in December.

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#204

Post by tacker2000 »

samhuk wrote: post #167

As a person living in the UK, I have definitely noticed a considerable rise in unit prices. One of many examples is that a loaf of my favourite bread increased from £3 to £4 recently, which was a shocker. Toilet roll prices, as ever what the news loves to talk about, has exploded, increasing by around 70% since 2020 by my anecdotal observation. A sad thought I have about inflation is the fact that it is, wittingly or…

You are talking like inflation is some conspiracy wielded by “the rich” (who are they? Are they all friends with each other and plan all their schemes together?) against the “others”.

Fact is the inflation we are seeing here is caused by the after effects of Covid, the Energy price surges caused by the Ukraine war and in the special case of UK - Brexit, which has lead to huge import shortages due to increased bureaucracy at the border, etc…

So please stop this conspiracy talk about the “rich” creating inflation to disown the “poor”.

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#205

Post by dukeyukey »

antibasilisk wrote: post #74
GalenErso wrote: post #10

As someone who doesn't live in the UK, the impression I get from headlines is that the UK is becoming poorer by the day, the NHS has collapsed, crime is exploding, poverty is rising, most people can't afford anything anymore, the Royal Mail is hanging by a thread, and the economy is in free fall. What's the reality? In London and outside?

London has experienced the worst drop in quality of life by far, other places are also being hit but they're kind of used to it by now and they can't really fall much further anymore.

I've lived in London for the past 6 years and I wouldn't say that at all. Food and energy has gone up (comparably to the rest of Europe), but there's a feeling that Sunak is more competent than the previous lot. Plus we're getting loads of tech investment.

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#206

Post by AnimalMuppet »

ilyt wrote: post #111
baggy_trough wrote: post #9

Earlier quoted context omitted.

For some reason they didn't want to cash in before?

They did but there wasn't a convenient excuse to raise the prices.

If they're the kind of people who are going to price gouge on food, they probably don't need a convenient excuse. They probably would do it anyway.

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#207

Post by hef19898 »

Tenoke wrote: post #32
noelsusman wrote: post #12

Is this at least partially Brexit related? For comparison, the US has seen food go up by around 10% over the same time period, which is pretty high but also far from 18%. https://www.bls.gov/news.release/cpi.t02.htm

A better comparison would be other EU countries and I'm seeing food inflation estimates for ~22% in Germany at the top of Google. 0. https://tradingeconomics.com/germany/food-inflation#:~:text=... . 1. https://www.google.com/amp/s/amp.dw.com/en/germany-inflation...

Last year we spent two weeks in Iceland. I do remember, 10+ years ago, paying the same for 2 (two!) onions as you did for 1kg in Germany over there. Last year, we were not shocked at all, actually we paid less then we did in Germany, not much but still. Turned out Icelands grocery prices were roughly on par with France, and a tad lower than Germany at the time.

So, German groccery prices did a lot of catching up since at least a hear. Slow enough so that you don't realize unless you are living on tight budget. That being said, since salaries in Germany tend to be higher than in France, the average German consumer is still a bit better off (ignoring housing or rent, and using a broad brush here).

The war im Ukraine did caise all kinds of issues, as did Covid. All ghinhs considered so, the developed world did reasonably well so far so. If food prices increaseore so, governments will have to intervene, as lower income families will have a hard time between increased energy and food prices.

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#208

Post by sumitkumar »

Would it not make sense to have a crypto solution to the inflation problem? Can't governments initiate a crypto currency which can be only used for a basket of goods and the providers of these goods can then exchange this currency for input goods or fiat money after verifying. This crypto coin can be distributed to everyone every month/week and with a expiry date.

What I understand is that inflation in high price goods gets passed on to the essential goods as a lifting tide lifts every boat but these can be decoupled.

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#209

Post by odood »

illiarian wrote: post #29

Meanwhile in Sweden the CEO of ICA, the largest supermarket chain in the country (53% of the market) said yesterday: "It is actually the consumer who controls what they are prepared to pay for a product. In the end, it is they who decide." https://omni.se/icas-vd-det-ar-kunderna-som-avgor-matpriset/...

And people will, by going to shops that are cheaper than ICA. We vote with our feet and our wallet.

Re: UK: Food inflation rises to 18.2% as it hits highest rate in over 45 years

#210

Post by PartiallyTyped »

nordsieck wrote: post #70
PartiallyTyped wrote: post #11

What about grocery store profit margins? > Bread was up 20.8%, with pasta products and couscous up 25.3% This is unjustified. Under no circumstances could this happen unless a) price gauging, or b) supply chain is drying up. Edit for the ignorant: > The UK is largely self-sufficient in production of grains, producing over 100% of domestic consumption of oats and barley and over 90% of wheat. Average yields over recen…

>> Bread was up 20.8%, with pasta products and couscous up 25.3% > This is unjustified. Under no circumstances could this happen unless a) price gauging, or b) supply chain is drying up. Are you aware that both Russia and Ukraine are (normally) major exporters of grain?

Are you aware that the UK is largely self-sufficient wrt grains?

> The UK is largely self-sufficient in production of grains, producing over 100% of domestic consumption of oats and barley and over 90% of wheat. Average yields over recent decades have been broadly stable but fluctuate from year to year as a result of better or worse weather. Increasingly unpredictable and extreme weather as a result of climate change is likely to exacerbate these fluctuations. Wheat yields in 2020 were the lowest since 1981 due to of unusually bad weather. However, preliminary data indicates they have since increased in 2021.

> The UK produces a significant proportion of its other crop needs, including around 60% of sugar beet, 70% of potatoes and 80% of oilseeds. Apart from a recent pest-related reduction in oilseeds, these proportions have remained stable over the last ten years. Climate change represents a risk to production both in terms of making conditions unsuitable for some crops and allowing new pests to proliferate but it may also benefit new types of crops.

> The UK produces over 50% of vegetables consumed domestically, but only 16% of fruit. 93% of domestic consumption of fresh vegetables was fulfilled by domestic and European production, while fruit supply is more widely spread across the EU, Africa, the Americas, and the UK.

https://www.gov.uk/government/statistics/united-kingdom-food...

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