Food and drink inflation jumps to 45-year high

Food and Drink Federation Scotland’s Chief Executive Officer David Thomson said:

“Today’s acceleration in food and drink inflation to 18.2% will come as disappointing news for households. It reflects the continued, significant pressure the food and drink sector is under as businesses grapple with persistent cost rises.

“We welcome Jeremy Hunt’s pledge to halve inflation this year made in last week’s budget but there’s certainly more governments across the UK can do to help our sector achieve this.

“It’s vital that the new First Minister supports our industry and keeps costs down for Scotland’s households. Scotland has a fantastic food and drink industry, supporting everyone’s daily lives and providing great jobs and careers across the country. Our success is also central to driving sustainable economic growth.”

Additional information:

• ONS data shows that over the year to Feb-23, on average, 72% of food and drink manufacturers stated they had to absorb rising costs. That compares with 56% of all companies across the UK and 53% of food retailers, suggesting that the industry has been disproportionately impacted by the rise in input costs during the pandemic and the war in Ukraine, compared to the average UK business. It also suggests manufacturers absorbed a lot of pain to support households and did not share the full extent of rising costs.
• The number of insolvencies in the food manufacturing industry has exactly doubled in 2022 compared to 2019 (244 vs 122). The 100% rise in insolvencies significantly outpaced the 27% rise in insolvencies in UK as a whole or 15% rise in manufacturing insolvencies.

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