Food inflation and availability update: Potatoes, pork, peppers and price predictions!
Overview
What’s going up, what’s going down, what to buy and what to consider switching. Read on to find out the latest food inflation and product availability updates from allmanhall…
inflation increased by approximately 17 to 22% March 2022 to February 2023.
Which products have seen high price rises?
Canned tomato products and tomato pastes have increased significantly over the last year. You may have noticed that Italian chopped tomatoes are over 40% more expensive year on year.
Pork prices have also risen substantially. UK deadweight pig prices are 211p/kg up from 138p/kg a year ago. Or 52.9%.
And beef? The deadweight price for finished steers (R4L grade) has risen by 17.4% is 492p/kg up from 419p/kg a year ago. Deadweight UK cattle prices are now quite close to UK R3L lamb prices, which are currently 511p/kg.
In January 2023, the average UK farmgate milk price was 49.2p per litre. The previous January it was 35.46p per litre. And two years ago it was just 30.24p per litre.
What about forecasted product shortages?
There are concerns that UK farmers have restricted crop plantings owing to the record low levels of UK rainfall in February. UK potato plantings could be much lower with fears of water shortages owing to the lack of rainfall in February. This will reduce supply, impacting availability. This is likely to then drive-up potato prices later this year.
Right now, what can you be doing?
At allmanhall we have been making recommendations to support foodservice operators in the face of high food inflation.
Understanding the relative costs of similar product groups is important. It will enable you to plan menus and rebalance purchases to include cheaper alternatives. For example, looking at protein at a commodity level, deadweight lamb is 511p/kg, beef 492p/kg, pork 211p/kg. And non-meat protein alternatives like lentils are 168p/kg.
Moving from branded purchases to own label can be highly economical. Particularly if they’re being used in back of house production and where quality standards allow.
Beyond pricing, do make sure you factor in the impacts of cooking on product yield and portion costs for yield loss, shrinkage and consistency.
It’s important to take into consideration the likely future market dynamics. Be cautious about trying to secure long term price holds when commodity market prices are high (as they currently are) and when some are likely to fall. Important tip: Long term price fixes are more effective when commodity prices are low as the risks associated with overpaying are minimised.
The short term outlook
The high price of food and limited availability of fresh produce will continue to grab headlines. We’ve seen this a great deal over the spring with salads, capsicum peppers and tomatoes significantly impacted by poor weather conditions in North Africa and Spain, plus high energy prices. This has led to empty supermarket shelves and, when available high prices. That said, any products that require energy intensive production methods like hothouse tomatoes and capsicum peppers will now likely see a less steep price increase over the summer months.
Vegetable oil commodity prices are falling. We would expect to eventually see this flow through to lower product prices for caterers. Spring is a time at which dairy commodity prices begin to soften, so we are keeping an eye out for a drop in the average farmgate milk price. For those that can afford lamb, the price of UK old season lamb is now 10.35% lower than a year ago.
At allmanhall we fully understand the complexities of food markets and supply. This enables us to support clients by managing that supply chain. We deliver proficient negotiation, mitigation of price rises as well as insightful advice to help plan and make best use of budget available. Contact us to find out more, today.
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