Food Inflation Set for Almost 4% by Christmas Amid Rising Costs

Food inflation is expected to reach almost 4% by Christmas, with prices peaking at 6.4% in July next year, according to a warning from the Food and Drink Federation (FDF). The FDF represents 12,000 food and drink manufacturers.

The industry has cited pressures from conflict and extreme weather as contributors to rising costs, which have already seen gas prices more than double since February. UK electricity prices are among the highest in Europe, while diesel prices have risen by 28.6% since the start of the conflict in the Middle East.

Climate-related events have also had an impact, with the cost of wheat up 45%, cocoa over 100%, rice up 60%, sugar up 27%, and coffee up 22%. Droughts across the UK and Europe this summer have further strained supplies, affecting fruit, vegetables, and grains.

FDF chief executive Karen Betts said food prices will rise this year and be sustained into 2027 due to persistently higher costs of energy, logistics, and packaging. The Government has been urged to ease pressure by relieving rising energy and regulatory costs on manufacturers.