Summer heatwaves set food prices ablaze, BRC says

Customers in Britain face increased food prices after a cold spring and a summer of heatwaves drove up the cost of fruit and vegetables.

Overall, shop prices fell by 0.3%, their lowest rate of decrease in eight months, as food inflation rose to 1.6% in July, an increase on the 1.2% seen in May and June, according to data released on Wednesday by BRC-Nielsen.

Fresh food prices surged 1.2% in July compared to 0.8% in June, while ambient food inflation increased 2.2% in July from 1.6% the previous month.

July was the 63rd successive month of overall shop price deflation, but non-food items also reached their lowest level of deflation since December 2017, dropping down to 1.4%.

Helen Dickinson, chief executive of the British Retail Consortium, said: "We expect this period of food price inflation to continue in coming months as despite global oil, food and commodities prices shrinking recently, the hot, dry conditions we have seen across the northern hemisphere means the pressure on prices will continue for some time to come."

Dickinson added that the pressures on food prices were a demonstration of the need for an agreement on the backstop to ensure frictionless trade is maintained after Brexit.

Mike Watkins, head of retailer and business insight at Nielsen, said: "Looking ahead, with weather related changes in commodity markets anticipated, fluctuating currencies and wavering consumer spending, retailers still need to minimise price increases, as the underlying trading conditions across the retail industry remain challenging."