Yahoo Finance Grocery bills jump by £788 as food prices hit record high
UK households face an extra £788 on their annual shopping bills as grocery price inflation hit a new record high.
At 16.7% in the four weeks to January 22, grocery inflation was the highest since Kantar started tracking the figure in 2008.
This is a sharp jump on December’s grocery inflation reading of 14.4%, which lifted Christmas spending to a record £12.8bn.
The report said that the record new rate meant that families faced a potential £788 annual rise in the cost of their regular shopping basket as a result of the hike.
Fraser McKevitt, head of retail and consumer insight at Kantar, said: “Late last year, we saw the rate of grocery price inflation dip slightly, but that small sign of relief for consumers has been short-lived.
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“Households will now face an extra £788 on their annual shopping bills if they don’t change their behaviour to cut costs.
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“Across the market the move is towards everyday low pricing, with many supermarkets offering price matching and using their loyalty schemes to help shoppers save.
“As a result of this push, the proportion of spending on promotions has dropped to its lowest level since at least 2008 this month, exaggerating the usual post-Christmas drop off in deals.”
Intense competition among grocers striving to retain customers saw them boosting their own-label ranges, with sales of these growing by 9.3% in January – well ahead of branded alternatives, which were up by just 1%.
Despite price rises, consumers appear to have maintained new year’s resolutions and a commitment to Dry January, with sales volumes of no and low alcohol beer up 3% on last year.
Overall take-home grocery sales rose by 5.7% during the four-week period and by 7.6% over the quarter.
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Aldi was the fastest-growing grocer for the fourth month in a row, with sales up 26.9% year on year and now holding 9.2% of the market. Lidl’s sales jumped by 24.1% to give it a 7.1% market share.
Among the three largest grocers, Sainsbury’s (SBRY.L) sales increased by 6.1%, just 0.1 percentage points higher than Asda and Tesco (TSCO.L), to give it 15.4% of the market.
Tesco remains the largest British retailer with a 27.5% market share while Asda holds 14.2%.
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