Inflation has begun to fall in the UK, prompting hope that the worst of the cost of living crisis could soon be behind us – but supermarkets are still continuing to impose sharp price hikes on their budget food items.
NationalWorld’s exclusive price tracker of supermarket value range food, drink and cleaning products recorded 152 price rises last month. It means of the 613 products we were able to take price snapshots for on 4 January and 6 February, a quarter got more expensive during that time – the greatest number and proportion of price rises we have recorded since last June.
This included over 20 Everyday Essentials products at Aldi, where shoppers have tended to be relatively insulated from value range price rises, according to our figures.
Our tracker includes over 790 products from the in-house value ranges at Asda, Aldi, Morrisons, Sainsbury’s and Tesco, with snapshots taken on a monthly basis. Prices are not available for every item every month, as products may not be in stock, or have been removed from the retailers’ websites. Some supermarkets have added new products over time, which have been incorporated into the tracker.
Since April last year, more than four out of five products (82%) have seen price rises, with several at least doubling in price during that time – marmalade from Tesco and Sainsbury’s, Morrisons toilet paper, Sainsbury’s washing up liquid, Tesco peppers and Tesco chocolate chip cookies.
The results for each supermarket between 4 January and 6 February are summarised below. We have also published a full list of value range products affected by price rises last month here.
- Aldi – 22 out of 54 items (41%) saw price rises between January and February, among which the average rise was 8%. The largest price hike was on a five-pack of Everyday Essentials oranges, which increased from 60p to 80, a rise of 33%.
- Asda – 37 out of 165 items (22%) got more expensive, by an average of 11%. A tin of Just Essentials carrots saw the biggest price rise, increasing from 23p to 34p per can – a rise of 48%.
- Morrisons – four out of 79 items (5%) got more expensive. The average rise among these four was 25%. This was largely driven by an 80% hike on a six-pack of Savers toilet roll, which went from £1.39 to £2.50 (although the £1.39 price point was a promotion. It was previously £1.50).
- Sainsbury’s – 34 out of 136 items (25%) saw price rises, with an average rise of 11% (this average excludes one item which was on a half-price promotion in January). The biggest price rises were seen across the Lovett’s 100g bars of dark, milk and white chocolate. These were previously 33p but are now 45p, a rise of 36%.
- Tesco – 55 out of 179 items (31%) got more expensive. Among those that saw price prices, the average rise was 11%. The biggest price rise was for Ms Molly’s chocolate and toffee layered desserts, which went up by 33%, from 49p to 65p.
Aldi also appeared to have issues with availability for many of its value range items, with 21 items out of stock online for the second month running. Of them, 10 had been out of stock for seven months running - although availability may vary by postcode when shoppers book a delivery slot.
The latest Consumer Prices Index (CPI) data from the Office for National Statistics (ONS) showed inflation had continued to fall, from 11.1% in October to 10.7% in November and 10.5% in December (meaning prices are not rising as quickly). But food prices had not followed suit, with inflation rising again to 16.8%.
Inflation was particularly high among milk, cheese and eggs, with prices up 30.2% in December 2022 compared to December 2021. Oils and fats (29.3%), food products such as ready meals and condiments (24%), and fish (19.6%) also saw high levels of inflation.
Why are supermarkets putting up food prices?
Last month Tesco boss John Allan accused food companies of using inflation as an excuse to hike prices higher than they needed to. The retailer’s chairman told the BBC’s Laura Kuenssberg it was “entirely possible” that food producers were taking advantage of poorer consumers, and that Tesco had tried hard to challenge unjust increases that manufacturers had passed onto it.
Despite bearing the retailer’s name, own-brand food products – including value range items – are usually produced by contracted manufacturers, although the arrangements are often secretive with manufacturers unwilling to disclose which supermarkets they produce goods for, according to a source with knowledge of the sector. This means farmers, food manufacturers and supermarkets are all involved in the chain from source to shelf.
NationalWorld asked Tesco whether Mr Allan’s comments applied to producers of its value-range item, but did not receive a response. Karen Betts, chief executive of the Food and Drink Federation, said however that food and drink businesses know they have a responsibility to keep products affordable, but have seen the cost of energy, ingredients, transport and packaging all rise in the past two years, alongside raised costs associated with borrowing, labour shortages, and last summer’s extreme heat in Europe, which led to poor harvests.
Responding to Mr Allan’s comments, she said: “Our companies’ experience is that supermarkets are very careful not to agree price rises unless they’re satisfied there’s evidence to justify them. Indeed many companies, including hard pressed small and medium-sized enterprises, tell us they cannot get supermarkets to agree to a price rise even then, and their business is therefore at risk.”
When will food prices come down?
NationalWorld also spoke to the Agriculture and Horticulture Development Board (AHDB) , which represents farmers, about when prices could come down. David Swales, head of strategic insight, said this was the “million dollar question” and that “it was very hard to predict”. The industry does expect prices will start to return to normal, he said, but this could be “several months down the line”.
“Farmers are in the same boat as everyone else,” he said. “The same way we are seeing our costs, our fuel costs, our energy costs shooting up, farmers are seeing that too. Some sectors – such as pig and poultry farming – have been in crisis as market prices have not risen to a level to cover costs.”
The higher prices food producers have paid to farmers – which then may be passed onto supermarkets – were necessary to prevent farmers going bust, and pushing up prices even further, he said, adding: “The idea that farmers are profiteering is laughable.”
While Tesco did not comment on its chairman’s comments, a spokesperson said: “With household budgets under increasing pressure we are absolutely committed to helping our customers, by keeping a laser focus on the cost of the weekly shop. So whether it’s price matching Aldi on the basics, locking the price of more than a thousand household staples until Easter 2023, or offering exclusive deals and rewards through thousands of Clubcard Prices – we’re more committed than ever to providing our customers with great value.”
Aldi was also asked about the unusually high proportion of price rises observed this month, and the apparent limited supply of some items. A spokesperson said: “We are working hard to shield customers from industry-wide inflation and have recently increased the number of Everyday Essentials products in our range. Our promise to customers is that we will always provide the lowest grocery prices, as confirmed by consumer champion Which? who recently named Aldi as Britain’s lowest-priced supermarket.”
Asda, Morrisons and Sainsbury’s were not approached for comment this month.