Prices are back on the up again, notes James Ball

The Grocer has warned since last November that food price inflation was set for a comeback.

At the time, the prediction seemed perverse. Commodities had fallen from their peak, and supermarket CEOs were heralding the end of supermarket inflation. Falling retail food prices in the early months of the year seemed to vindicate the view that the crisis was over.

But almost unnoticed, key food commodities like wheat, soybeans and corn are all up more than 25% from their low points, an effect magnified for UK companies by this year's sharp fall in sterling.

But there is likely worse to come: the price of oil is up 44% from its sub-$50 trough to $71.50.

So far fertiliser, petrol, packaging and numerous other costs that rely on oil have not yet followed. Throw in poor global harvests on sugar and wheat, and the situation gets trickier still.

The evidence to date doesn't point to a repeat of the pain of 2008. But shoppers who've believed everything they've heard about deflation this year could be in for a heck of a shock.