Food inflation has fallen to its lowest level in three years.

Food prices rose by just 1.2% year on year in March, according to data from the British Retail Consortium, down from 1.3% for the previous month.

Falling commodity costs were a key factor in the drop, with the price of corn down 7.1% in March and coffee down by more than 14%.

The BRC also cited “considerable downward pressure” on vegetable prices.

“This is great news,” said BRC director general Stephen Robertson.

“food inflation has fallen to its lowest level for over three years and overall shop price inflation [which dropped from 1.7% to 1.2%] is at its lowest since November.”

Read more
Retail Prices: Forget the blip in produce, the trend is downhill (3 April 2010)
Mults rely on promotions in February but growth still slow (3 March 2010)