The latest Foodservice Price Index report from Prestige Purchasing and CGA brings encouraging news for the foodservice industry, with inflation rates returning towards more normal levels.The report for April 2024 indicates a significant year-on-year fall in inflation of 2.5%, continuing a steady trend towards stability in pricing that will be welcome news for both businesses and consumers.
While the overall decline is welcome, the data reveals a nuanced picture across different food categories. Only two categories recorded month-on-month deflation, while six others showed inflation rates of 1% or less. While there is a degree of price stability across most segments, some areas are subject to fluctuation.
This has led to the first month-on-month inflation since January—a sign that although the foodservice sector is recovering well from recent global disruptions, some supply issues continue to impact pricing. Standout categories in the latest Foodservice Price Index report include vegetables, which saw the highest month-on-month inflation of 1.4%. This increase follows extreme weather conditions in the UK and Europe, including one of the wettest winters on record. Conditions have hampered planting and impacted crop yields, leading to a scarcity of fresh produce and driving up prices for both consumers andbusinesses.
Shaun Allen, CEO of Prestige Purchasing, commented: “The April Foodservice Price Index report paints a picture of cautious optimism for the industry. While some categories are still experiencing price fluctuations, the general trend towards lower inflation rates is a positive sign for the sector's recovery."However, it is important to remain vigilant about the potential impact of external factors, such as weather patterns and global events, which could continue to influence prices in the coming months.”
James Ashurst, client director at CGA by NIQ, said: “Business across the foodservice sector will be hugely relieved to see some stability in pricing after many months of very high inflation. It should give business confidence a much-needed boost, and will hopefully also feed through to increased consumer spending in due course. Nevertheless, the supply chain remains vulnerable to micro inflationary pressures, and all hospitality businesses need to continue managing costs very carefully.”
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