POOR families are being hit the hardest as supermarkets are increasing the prices of their cheapest groceries faster than others, The Sun on Sunday can reveal.
Analyze us by which consumer group? shows that the cheapest budget range increased by 25% last month from a year ago
But branded products like Kellogg’s cornmeal and Heinz baked beans increased by an average of 13.8% and prices at individual supermarkets increased by 20.2%.
Many low-income households bought budget ranges from Tesco, Sainsbury’s, Morrisons and Asda to save cash even before the cost of living crisis – and sales are now up 46 per cent over the same period period last year, according to recent data from data company Kantar.
But those ranges have increased in price and cheaper options are gone, meaning shoppers struggle to get food items out of their carts and buy less because they can’t afford them. pay.
Sue Davies, Which one? “This food inflation crisis is plaguing millions across the country,” said the head of food policy.
“They told us they had to skip meals or use food banks just to cope at a time when some supermarkets were still able to make good profits.”
Last week, the Bank of England blamed soaring food prices for higher inflation lasting longer than expected.
It said food manufacturers are slow to pass on reduced wholesale prices to shoppers.
But a senior supermarket source said rising prices for energy, ingredients and wages had taken the food industry longer to move into other areas.
“It can take three to nine months from the time the wholesale price drops until the customer notices that change due to the gap between when the goods are ordered and the time it takes,” he said. to produce and ship them to the shelves.
“Many value-added essential products, such as dairy, bread and pasta, have been hit hard by skyrocketing prices due to rising wheat costs as well as energy and labor costs. that they use in processing.”
For example, Sainsbury’s cheapest spaghetti, Hubbard’s Foodstore Spaghetti, is 56 cents a kilo, compared with £1.9 per kilo for its own brand, but branded Napolina pasta is £2.50 per kilo.
All three will face roughly the same cost increases for energy, raw materials and wages, but they account for a larger share of the overall price of the cost of making the cheapest products.
As a result, industry experts say the range of values is more affected by inflation.
Clive Black, analyst at investment group Shore Capital, said: “The current spike in food prices in the UK reflects a number of factors. Some are due to higher commodity prices, especially after Russia’s invasion of Ukraine.
“With supply contracts and the like, it can take several quarters for higher input prices to recover, so once prices peak there will be a similar timeframe for prices to be at sell levels. retail decreases.”
Concerns that major manufacturers and supermarkets are profiting from the cost of living crisis has brought the food industry to the fore.
On Tuesday, Prime Minister Rishi Sunak will hold a “food summit” to try to tackle the problem of soaring prices.
He will meet supermarket directors, ministers from the Department for Environment, Food and Rural Affairs, and representatives from the National Farmers’ Association, the Food and Beverage Federation and the British Retail Consortium.
Sun and farmer columnist Jeremy Clarkson, who has highlighted how bureaucracy has made running a food business difficult through his television show Clarkson’s Farm, will also present.
Soaring food prices have even led to calls from the Liberal Democrats for an investigation into competition in supermarkets.
In France, retailers have been under pressure from the government to limit a wide range of food prices, despite their profit margins, to offer the lowest possible prices in an effort to help households. coping family.
Supermarkets highlight the fact that Tesco’s and Sainsbury’s recent financial results show their profit margins have declined over the past year and that they have begun to lower prices on certain items such as milk, bread and butter to reflect reduced wholesale prices.
But those staples are still far more expensive than they were a year ago, and are unlikely to return to their cheap levels anytime soon.