Latest data from the Which? Supermarket Inflation Tracker confirms that price rises are starting to slow, although the figure remains high despite claims by the leading supermarkets that they are starting to cut some prices to reflect falling costs.
Based on a comparison of around 25,000 products at eight supermarkets – Aldi, Asda, Lidl, Morrisons, Ocado, Sainsbury’s, Tesco and Waitrose – the tracker showed that annual inflation for food and drink dipped slightly again to 16.4% in the three months to 30 June 2023 (down from its peak of 17% in the three months to the end of April and also down from last month’s figure of 16.9%).
In the one month to 30 June, the figure was 15.4% (down from 16.5% the previous month).
While year-on-year inflation is falling, Which? noted that it was worth bearing in mind that this time a year ago, prices were already substantially higher than they were a year before that. So in June 2023, it also looked at two-year inflation.
Food prices in June 2023 were 25.8% higher than they were in June 2021, and some individual items had risen far more sharply. Examples highlighted by the consumer watchdog included a pack of six Mr Kipling bakewell cake slices, which had jumped by 175% from £1 to £2.75 at Sainsbury’s.
At Morrisons, own-label mozzarella (125g) went from 49p to £1.19 on average, an increase of 142.9% over the two-year period. Asda’s own-label Free From Special Flakes (300g) were up 141.9%, from 62p in 2021 to £1.50 in 2023, while Lidl’s Chene D’argent French Brie 200g went from 79p to £1.85 – 134.2% more.
In the latest annual comparison, Which? gives an inflation breakdown by category:
Source: Which? Supermarket Inflation Tracker
During the cost of living crisis, Which? has been campaigning for retailers to be forced to display detailed price information on loyalty card offers and promotions so shoppers can find the best deals.
The consumer watchdog said the government needed to close loopholes that result in “confusing and inconsistent” pricing practices of some supermarkets. Last month it reported Tesco to the competition watchdog (the CMA) because it does not provide unit prices – such as the price for each 100g or 100ml – for its Clubcard Prices offers.
“Two years of relentlessly soaring food prices have had a devastating impact on households,” said Sue Davies, the Which? head of food policy. “This isn’t helped by the confusing and inconsistent pricing practices used by some supermarkets, which make it incredibly difficult to work out how to find the best value products.”
After the Which? criticism, a recent blog post by Tesco’s UK Chief Executive, Jason Tarry, said: “We are going to bring forward some long-planned work to our Clubcard prices to make it simpler for our customers to see by weight or volume just how competitive those offers are, and will introduce unit pricing for simple promotions by early next year.”
In January, the CMA began a review into unit pricing in the grocery sector and then widened its probe in May to examine whether supermarkets and suppliers have been profiteering during the inflation crisis. The competition regulator is expected to publish the initial findings for both investigations on Thursday.
NAM Implications:
- This means the rate of increase in prices is slower…
- …but prices are not necessarily falling.
- i.e. ‘Food prices in June 2023 were 25.8% higher than they were in June 2021
- Meanwhile, the elimination of ‘“confusing and inconsistent” pricing practices of some supermarkets would clearly be in everyone’s interest…
