While year-on-year inflation decreased to 2.8% in August 2024, marking the 14th consecutive month of decline, prices have shown a 0.5% increase month-on-month across various goods. “The continued decline in foodservice inflation is a positive sign, but the ongoing monthly increases and high inflation in specific areas highlight the current market’s vulnerability,” stated Shaun Allen, CEO of Prestige Purchasing.
The rise in August was mainly driven by the beverage category (excluding alcoholic drinks), which saw a total year-on-year inflation of 5.8%. The segment for mineral waters, soft drinks, and juices experienced a notable jump of 6.7%, while tea, coffee, and cocoa remained high at 4.7%. Conversely, total food basket prices showed a milder inflation rate of 2.5%.
Among the eight food categories, dairy prices fell by 0.3% and oils and fats by 1.2%. However, vegetables and the sugar, jam, syrups, and chocolate segments reported the highest inflation rates, increasing by 9.1% and 8.2% respectively, though these figures reflect a slight reduction from July.
Reuben Pullan, senior insight consultant at CGA by NIQ, remarked, “Years of soaring prices have been challenging for the hospitality sector, and there is considerable relief as they begin to retreat.” Nonetheless, he added, “Foodservice inflation is still higher than in many other sectors, and the uptick over the summer indicates that challenges remain. While some costs are easing for both businesses and consumers, revenue and margins are expected to face ongoing pressure in the last quarter of 2024.”
