Shoppers will face a prolonged squeeze on their finances through 2027 and 2028, according to fresh food inflation forecasts from the IGD.
The charity has predicted food inflation will rise to 5.6% to 6.6% in 2027 and remain around 5.3% to 6.3% in 2028.
ONS figures released this morning showed the 12-month food inflation rate had remained steady in August at 1.3%.
While the IGD said “plentiful food stocks at the start of the year, hedging and moderate demand” have helped hold back price increases so far in 2026, an intensifying Middle East conflict and extreme weather from El Niño will likely send food prices higher over the coming year.
The IGD’s forecasts matched those issued by the FDF last week, when the federation predicted a peak of 6.4% in July 2027 and rates of more than 5% extending into 2028.
““Food inflation’s current weakness will not last,” said IGD chief economist James Walton.
“Stock buffers and hedging have delayed, not removed, the pressure building from disrupted energy markets and extreme weather.
“Shoppers have already adapted to repeated periods of high food price inflation. Many have changed how and where they shop, switched products or reduced discretionary spend, leaving fewer options available to absorb any further price rises.”
El Niño was identified by the IGD as a “high-severity risk” with its extreme weather effects on farming yields, quality and availability to persist well into 2027 and beyond for important global commodities such as sugar, coffee and cocoa.
But the largest contribution to UK food inflation will likely be from fruit & vegetables, the IGD said, thanks to their high sensitivity to weather patterns.
However, almost all goods will be subject to indiscriminate cost pressures such as energy prices, regulatory change and supply chain disruption.
“For businesses, this reinforces the need to look beyond short-term mitigation and focus on strengthening the resilience of the food system,” said Walton.
“Greater productive capacity, ideally domestically where appropriate, would help improve resilience across the food system. Combined with stronger productivity, this could support the industry’s contribution to UK economic growth and help drive more stable pricing over time.”
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