The price of eggs, dairy and meat is soaring

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Food inflation has hit new record highs as egg, dairy and meat prices all soar, leading to increasing pressure on households in the run up to Christmas.

The British Retail Consortium warned that winter looked “increasingly bleak” as price rises continued unabated.

The trade body’s latest shop price index this morning revealed food inflation accelerated strongly to 14.2% in November, compared with 11.6% in October. It is the highest rate in the food category on record.

Fresh food inflation jumped from 13.3% in October to 14.3% this month - also the highest rate on record for the sub-category.

Ambient food inflation raced to 10%, up from 9.4% in the prior month, which is the fastest rate of increase in the category on record.

BRC chief executive Helen Dickinson noted the effect of soaring energy costs and rising costs of animal feed and transport on the price of eggs, dairy and meat. She added that coffee prices had also shot up on last month as high input costs filtered through to price tags.

Non-food inflation rose from 4.1% to 4.8%, while overall shop price annual inflation increased to 7.4%, up from 6.6% in October, marking another record for the BRC-NielsenIQ index since it was started in 2005.

It follows the UK rate of inflation hitting 11.1% in the year to October as food price rocketed to 16.2%, according to the latest ONS data released earlier this month.

Dickinson said: “While there are signs that cost pressures, and price rises, might start to ease in 2023, Christmas cheer will be dampened this year as households cut back on seasonal spending in order to prioritise the essentials.

“Retailers continue to do all they can to support their customers and ensure everyone can enjoy the festive season by fixing prices of many essentials, offering discounts to vulnerable groups, raising pay for their own people, and expanding their value ranges.”

Mike Watkins, head of retailer and business nsight at NielsenIQ, said: “With prices still rising, the cost of Christmas will be higher this year and shoppers will be managing their budgets more closely than at any time since the start of cost-of-living crisis.

“Retailers are now responding by offering seasonal savings and price cuts and will be hopeful of an uptick in shopper spend as we move into December.”

Morning update

Tim Jones, the non-executive chairman at drinks ingredients specialist Treatt, has been appointed as non-executive chairman at Carr’s Group, the speciality agriculture and engineering group.

He leaves Treatt, where he has been chairman since 2012, at the company’s AGM in January, taking up his new role in February after Carr’s AGM.

Current Carr’s chairman Peter Page will take over as the group’s CEO as previously announced in August.

Jones said: “I am delighted to be joining Carr’s at this immensely exciting point in the company’s development.

“Both the speciality agriculture and engineering divisions are industry-leading businesses, and I very much look forward to helping guide the company, supporting long-term value creation for its shareholders and wider stakeholders.”

This morning the FTSE 100 is up 0.2% to 7,525.98pts so far.

Early risers in fmcg include Kerry Group, up 6.2% to €91.14, Hilton Food Group, up 2.5% to 547.3p, Deliveroo, up 2% to 88p, and Compass Group, up 1.8% to 1,863p.

Naked Wines is down 4.5% to 87p so far, while HelloFresh is down 2.3% to €22.75 and AG Barr is down 1.3% to 497.5p.

Yesterday in the City

The FTSE 100 hit highs not seen since the summer yesterday, rising 0.8% to 7,531.55pts.

Greencore shares sank 6.8% to 66.4p as the food-to-go group warned of further substantial inflation in the coming year and an impact on squeezed consumers.

Treatt slipped 0.5% to 661p following the drinks ingredients specialist reporting a “difficult” set of annual results as margins took a hit due to lower hard tea sales in the US ready-to-drink cocktail market.

Shares in Supreme also plunged 6% to 102.5p after the vaping supplier posted falling profits in the first half.

Risers yesterday included Virgin Wines UK and C&C Group, up 2.7% to 71.4p and 2.1% to 182.1p respectively.