Brexit, Ukraine war set to push UK food prices up 15% - IDG

British food prices are set to surge 15% this summer and will remain high for at least a year, in a further blow to hard-pressed consumers already struggling with the cost-of-living crisis, according to a report released on Thursday.

The Institute of Grocery Distribution said meat, cereals, dairy, fruit and vegetables are likely to be the worst affected as Russia’s war in Ukraine drives up the price of key foodstuffs.

Prices have also been impacted by Brexit, production lockdowns in China and exports on key ingredients such as palm oil from Indonesia and wheat from India.

The IDG estimated that the average monthly spend on groceries for a typical family of four would reach £439 in January next year – up from £396 in the same month in 2022.

Its report added that Brexit and a reliance on imports had left the UK’s food and consumer goods industry “uniquely exposed to current pressures”.

British farmers are struggling to recruit workers to harvest food as most were forced to leave when Britain left the European Union. This has resulted in crops being left to rot in fields and the culling of animals, particularly pigs, as there are not enough abattoir workers.

“From our research, we are unlikely to see the cost of living pressures easing soon. This will undoubtedly leave many households – and the businesses serving them – looking to the future with considerable anxiety,” said IGD chief economist James Walton.

“If average food bills go up 10.9% in a year, a family of four would need to find approximately £516 extra a year. We are already seeing households skipping meals – a clear indictor of food stress.”

“We expect the mood of shoppers to remain bleak for the foreseeable future as they are impacted by rising inflation and a decline in real wages. Shoppers are likely to dial up money-saving tactics as far as possible.”

Household budgets are under further pressure with energy and petrol prices spiralling out of control against a backdrop of the highest tax burden in seven decades, already low wages falling in real terms at their fastest rate in 20 years and living standards at their lowest level since records began.

Last week the cost of filling up an average family car went beyond £100 with no sign of any government intervention on the horizon. Almost half the cost of a litre of fuel is tax, including sales tax on government duty – in effect a tax on a tax.