Grocery price inflation eased further this month, though consumers remain apprehensive about the Middle East crisis’s potential impact on food costs.
Supermarket prices were 3.1 per cent higher year-on-year in May, a decline from April’s 3.8 per cent and March’s 4.3 per cent, Worldpanel by Numerator figures show.
Shoppers increasingly relied on promotions to mitigate costs, with 30.3 per cent of sales involving a deal last month, up from 28.4 per cent a year prior. Spending on full-price items remained virtually flat, growing by just 0.1 per cent.
Fraser McKevitt, head of retail and consumer insight at Worldpanel, said: “The easing in the rate of inflation is welcome news for shoppers who have been grappling with warnings of a hike in food prices due to the impact of the war in the Middle East.”
These figures emerge days after the Government announced plans to suspend tariffs on some food imports, part of wider efforts to combat rising prices.
The full list of products is yet to be published but is expected to include biscuits, chocolate, dried fruit and nuts.
Ocado continued to be the fastest growing grocer with sales up by 10.2 per cent year on year, although this is the slowest recorded rate of growth for the online specialist since July 2024.
Discounter Lidl reached a new record high market share of 8.6 per cent over the 12 weeks to May 17, securing its position as Britain’s fifth largest grocer behind Tesco, Sainsbury’s, Asda and Aldi.
Sales at Tesco increased by 3.2 per cent, with market share rising to 28.2 per cent, while Sainsbury’s sales grew up 3.1 per cent to achieve a 15.2 per cent share.
Waitrose sales were up 3 per cent and Marks & Spencer saw its grocery sales increase over the quarter by 9.3 per cent.
The news comes as British households face persistently high prices for essential food items such as bread and pasta, with a new report attributing the long-term trend to ongoing global events like the Middle East crisis and the El Nino weather pattern.
Analysis from the Energy and Climate Intelligence Unit (ECIU) suggests that price hikes following “major shocks” tend to recede only gradually and partially.
This “rocket and feathers” effect, where food prices “shoot up like rockets but drift down like feathers”, means consumers are left with elevated grocery bills long after the initial disruption has subsided.
The think tank’s findings, based on over three decades of UK data, indicate that shelf prices recover a mere 1 per cent of their original increase after six months, rising to just 7 per cent after two years.
When adjusted for wages, only about a third (35 per cent) of the initial affordability impact is unwound within a two-year period, explaining why grocery costs remain significantly above pre-pandemic levels despite some contributing factors easing.
