Price of milk and sunflower oil starting to fall

The prices of food staples such as oil and milk are finally “edging down”, even though shopping bills remain high, new data suggests.

Research firm Kantar said shoppers paid on average £1.50 for four pints of milk in July, down from £1.69 in March.

The average cost of a litre of sunflower oil, meanwhile, is now £2.19, which is 22p less than in the spring.

It comes as grocery inflation – the rate at which overall food prices rise – remains high but is starting to ease.

Prices increased by 12.7% on an annual basis in the four weeks to 6 August, according to Kantar, which tracks the spending habits of 36,000 UK households.

That is down from 14.9% a month earlier.

Food prices surged last year, in large part because of the Ukraine war, but there are signs the pressures may be beginning to ease as wholesale prices come down.

The major supermarkets have also begun to cut the price of basics such as eggs, milk and loo roll as they face pressure to do more to help struggling shoppers.

It follows criticism that they have not passed on falling wholesale prices to customers – claims that they deny.

Fraser McKevitt, head of retail and consumer insight at Kantar, said that UK grocery prices overall were “still up year-on-year across every supermarket shelf”, but that consumers “will have been relieved” to see the cost of some staples fall compared with earlier in the year.

Shoppers also continue to seek ways to cut their grocery bills, he said, such as shopping at discounters Aldi and Lidl or buying cheaper supermarket own-label goods.

Sales of own-label goods remained popular last month, https://www.wizeguyzpizza.com/ Kantar found, climbing 9.7% on an annual basis. In what may be a sign of growing consumer confidence, however, it said sales of more expensive branded groceries also started to pick up.

It comes despite separate research from consumer group Which? that found the price of some branded goods on supermarket shelves has more than doubled in the last 12 months.

The consumer champion, which tracked almost 26,000 food products at eight major supermarkets, found:

• a six-pack of Mr Kipling chocolate slices at Tesco was the branded product that rose the most in price, going from £1.16 on average in 2022 to £2.66 in July 2023
• 1kg of Lancashire Farm natural yoghurt at Asda increased from £1 to £1.80 – up 80%
• 180g of Pilgrims Choice extra mature grated cheddar at Morrisons went from £1.20 to £2.11 – a rise of 76%.

The BBC has contacted the supermarkets for comment.

Food prices have been one of the biggest contributors to the UK’s overall rate of inflation which remains stubbornly high.

New figures, due on Wednesday, are expected to show that the overall pace of UK price rises slowed to between 6.7% and 7% in July, down from 7.9% in June.

Even with grocery inflation easing, food prices are expected to remain high for the rest of the year, according to the Bank of England, leaving millions of households under pressure.

Huw Pill, its chief economist, said last week that the return of lower food prices is “something we may not be seeing for a while yet, if in the future at all”.