Food Prices Continue to Rise Steeply As Pressure Builds

UK food inflation is forecast to reach 5.7 per cent by December, fuelled by poor harvests and the financial impact of domestic policies trickling down to supermarket shelves, prompting growing calls for the government to help curb the trend. 

Shoppers are facing prices for everyday grocery items that are “steeper than anything in recent decades”, noted the Food and Drink Federation (FDF), and at a level that outpaces other European countries, including France, Germany, and Spain.

In August, food and drink price inflation climbed for a fifth consecutive month; reaching 5.1 per cent, up from 4.9 per cent in July, according to the latest official figures from the Office for National Statistics (ONS).  

During the 12 months to August 2025, the ONS said beef and veal saw the sharpest increases in prices (rising by 24.9 per cent), followed by butter (18.9 per cent), chocolate and coffee (both up by 15.4 per cent), and whole milk (12.6 per cent). 

In the fresh produce category small price increases were recorded across a range of vegetables, while fruit and vegetable juices also saw a higher rate of inflation in August compared with July.

Between January 2020 and July 2025, FDF says UK prices for food and non-alcoholic drinks have surged by 37 per cent; significantly higher than overall UK inflation at 28 per cent.

Pressure Will Build Through Autumn

Following several months of high inflation rates, the FDF, whose members represents a quarter of food and drink sold in the UK, predicts the pressure on consumers will continue to mount through the remainder of the year. 

Already at its highest level for 18 months; FDF now estimates that food and drink inflation could reach 5.7 per cent by December, as food manufacturers suffer the financial burden of government policies. The forecast is an upwards revision from its previous prediction of 4.8 per cent. 

For fresh produce alone, the impact of the extreme weather across the summer, from wildfires in Europe to water shortages for UK farmers, will be felt in produce prices and availability for some months to come, according to hospitality purchasing specialist Lynx Purchasing. 

Broccoli and cauliflower are already in short supply, while the combination of the heatwave and hosepipe bans made it harder to plant UK winter crops of a range of produce, including potatoes, parsnips and carrots, Lynx Purchasing reported in its Autumn 2025 edition of Market Forecast. 

Further afield, European production of salad crops such as tomatoes, peppers, cucumbers and lettuce has been restricted by widespread wildfires.

Economists say food suppliers and retailers are facing increasing pressures, including poor harvests following the hottest recorded UK spring and summer, new packaging rules, and rising employment costs. Meanwhile concerns about potential business rate changes loom ahead of the Budget on 26 November.

The British Retail Consortium (BRC) said in a statement that “retailers are doing everything they can to deliver great value for their customers, but are unable to absorb the £7 billion in costs they have been landed with this year thanks to rising costs of National Insurance, higher NLW, and a new packaging tax”. 

Government Urged to Curb the Trend

BRC believes Chancellor Rachel Reeves can help turn the tide at the Budget by delivering “a meaningful business rates reduction”, with no shop paying more as a result. “If the Government instead chooses to burden the industry with more costs, then it will be households who feel the pinch as they go about their weekly shop,” BRC explained. 

Already, Aldi CEO Giles Hurley has warned that food prices could rise if the Chancellor introduces new measures in the November Budget that increase costs for businesses.

“Any policies which affect the operating costs of business should be considered very, very carefully because of the very real risk they find their way... back into the food system and onto prices,” Hurley told BBC News. 

With commodity and energy prices stabilising, but inflation still on the rise, FDF agrees the government has an opportunity to curb this trend by relieving cost pressures on businesses.

FDF’s Chief Executive Karen Betts said that business costs are such that companies can no longer absorb them and are having to pass at least some of them on to consumers.

“As this autumn’s Budget looms, it’s critical that government does not add further to the already high costs of regulation in our sector,” Betts urged. “We’ve been hit by rising taxes, employment costs and a new packaging tax.”

In response to the ONS data, Chancellor Reeves has said she knows “families are finding it tough”, adding that she is “determined to bring costs down and support people who are facing higher bills”.

With incentivising government policies, the FDF believes the UK food and drink manufacturing sector could unlock a £14bn growth opportunity. 

Read the FDF’s UK Food & Drink Inflation 2025-26 Outlook.

Read the Autumn 2025 Lynx Purchasing Market Forecast.