UK food prices increase at fastest pace in a decade

UK food prices increase at fastest pace in a decade

Opinion















UK food prices are rising at the fastest pace in more than a decade. Britain’s big four supermarkets are trying to pass on their own inflation by charging more. However, they must be careful not to sleepwalk into a crisis — as they did in the wake of the great recession, when they drove customers into the arms of the no-frills supermarkets Aldi and Lidl. That was a catastrophe for the mainstream grocery sector — and a boon for the German upstarts.

Monthly grocery price inflation reached 5.9% in April, the highest level since December 2011, according to data provider Kantar. As my Bloomberg News colleagues have reported, the combination of rising commodity prices, escalating labor costs and Brexit is raising fears that the era of cheap food is over.

The last time food prices rose significantly a decade ago, the so-called big four supermarkets — Tesco Plc,

J Sainsbury Plc, Asda Group Ltd and Wm Morrison Supermarkets Ltd — miscalculated badly. They raised prices across their stores, punctured by special offers funded by the big branded manufacturers.

In contrast, the UK branches of Aldi and Lidl offered permanent