Cost of living crisis: why are some food prices 20% up in 2022? Which? supermarket inflation report explained
It comes after new Office for National Statistics CPI inflation figures showed food had become 6.7% more expensive in April 2022 compared to the previous year
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As well as rising food prices, the Office for National Statistics Consumer Prices Index has found that soaring energy bills and fuel prices have had a major impact on household spending power.
So what were the Which? food inflation findings - and why have some items risen in price?
What did Which? food inflation research find?
In a report released on Saturday (21 May), Which? said it had found evidence of major price inflation on some UK food products.
The consumer group said analysis of more than 21,000 food and drink items between December 2021 and February 2022 showed inflation was 3.14% on average compared with the same period two years ago.
However, this relatively low figure masked some huge price rises Which? said, as it found 265 products had seen price increases of more than 20%.
These included popular products, such as:
- Kellogg’s Crunchy Nut Corn Flakes Cereal (500g pack) - up 21.4% at Tesco
- Asda own-brand closed cup mushrooms (250g) - up 21.4%
- Cathedral City Extra Mature Cheddar (350g) - up 21.1% at Ocado
When Which? looked at price changes on a category-by-category basis, it found prices had risen across the board.
Those seeing the highest inflation included:
- Fizzy drinks (5.85% up on average)
- Butters and spreads (4.9%)
- Energy drinks (4.8%)
- Milk (4.6%)
At the other end of the scale, the categories that saw the lowest inflation were:
- Chocolate (1.4%)
- Fresh fruit (1.6%)
- Biscuits (1.8%)
- Vegetables (1.9%)
The supermarkets with the biggest amount of price inflation were found to be Morrisons (4.08% higher), Asda (+3.97%), Tesco (+3.48%) and Aldi (+3.2%).
Which? pointed out that the reason Morrisons is likely to be at the top of the table is because it owns much of its fresh food supply chain, meaning it cannot switch to cheaper suppliers as easily as other supermarkets.
Reasons given by the consumer group for why inflation had gone up across the board included: global economic pressure caused by economies reopening after Covid, resulting supply chain challenges, as well as labour shortages.
The period Which? looked at did not cover the price shocks resulting from Russia’s invasion of Ukraine - although it predicted the war would push prices much higher for longer.
What other supermarket pricing changes did Which? find?
The analysis of supermarket price inflation by Which? also discovered the practice of ‘shrinkflation’ - whereby the size of items is reduced marginally but the price is kept the same, meaning consumers are paying more for less - was still in action.
Some of the most notable examples it found, were:
- Nescafé Azera Americano decaff instant coffee - shrank from 100g to 90g in Tesco in February 2022 but price remained at £5.49 (11% price increase per 100g)
- Persil non-bio washing powder - reduced from 40 washes (2.6kg) to 37 washes (1.85kg) at Tesco, Asda and Morrisons in 2021 but stayed the same price
- Surf Tropical Lily Ylang Ylang washing powder - went from 40 washes (2.6kg) to 39 washes (1.95kg) at Tesco without falling in price (Unilever told Which? both the Persil and Surf products had been reformulated to more concentrated levels)
- Walkers Classic Variety Crisps - went from 24 bags in a multi-pack to 22 bags in Tesco, Asda and Morrisons in 2021 while staying at the same price
Which? also looked at how different pricing tiers had changed, as well as how the effectiveness of supermarket promotions had changed since the Covid pandemic.
It found retailer own-label value ranges had risen by just 0.2% in the time period - although analysis by NationalWorld of a more recent time period suggested average value and own-brand ranges had risen more sharply in recent months.
According to Which?, standard ranges rose in price by 2.84%, while the highest inflation was seen in own-label premium ranges which jumped 3.15% over the two year period.
When it came to promotional activity, Which? found the number of promotions had dropped dramatically across most popular food and drink categories, with the size of saving also falling in around 75% of the categories the organisation looked at.
Supermarkets curtailed much of their discounting during the initial phase of Covid after panic buying threw supply chains into disarray.
For example, the number of discounts on bottled water fell 14.7%, while promotional activity for vegetables dropped 11%.
The scale of savings plummeted the most in the butters and spreads category, where savings were reduced by 3.59%.
Vegetables were next, falling 3.45%, while crisp promotions were 2.88% less generous.
What did Which? say about its price inflation research?
Off the back of its findings, Which? urged supermarkets to do more to help consumers with the current cost of living squeeze.
In particular, it said clear unit pricing should be provided to allow consumers to make purchasing decisions more easily.
It also urged retailers to ensure budget items are readily available.
“Our research reveals that eye-watering price rises are being exacerbated by practices like shrinkflation and limited availability of all-important budget ranges,” said Sue Davies, Which? head of food policy and consumer rights.
“These factors are combining to put huge pressure on household shopping budgets.
“During an unrelenting cost-of-living crisis, consumers should be able to easily choose the best value product for them without worrying about shrinkflation or whether their local store stocks budget ranges.”
What have supermarkets said about the Which? report?
The British Retail Consortium (BRC) - a trade body representing most major UK supermarkets - said retailers were doing “all they can to keep prices down and deliver value” for consumers.
“Rising inflation is a continued concern for both consumers and retailers,” said Andrew Opie, director of food and sustainability at the BRC.
“The global price of many food commodities has reached record highs over the last few months, pushing up prices for consumers.
“Other price pressures include increased energy, transport and labour costs, all of which are being exacerbated by the situation in Ukraine.”
Tesco, which is not represented by the BRC, said it was “committed to providing great value” and pointed to its various offers, including its ‘Low Everyday Prices’ strategy for everyday staples, and Clubcard prices.