Foodservice price inflation accelerates as festive demand peaks
Categories including milk, cheese and eggs recorded the highest increases at 1.9% as domestic pressures intensified despite softening global dairy markets
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Foodservice price inflation rose by 1.1% in December as festive demand and supply-side constraints drove up costs across the hospitality sector, according to the latest Foodservice Price Index from Prestige Purchasing and NIQ.
Categories including milk, cheese and eggs recorded the highest increases at 1.9% as domestic pressures intensified despite softening global dairy markets.
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Avian flu disruptions reinforced volatility in egg supply chains, compounding costs during a peak usage period for hospitality operators.
Fruit prices rose by 1.8% in December as markets shifted to higher-cost glasshouse production and Spanish citrus yields remained significantly reduced.
Coffee, tea and cocoa markets traded near multi-year peaks due to adverse weather in Brazil and Vietnam alongside weak West African harvests.
Meat and poultry inflation reached 1.5% as seasonal demand for beef and poultry collided with tight domestic availability and supply chain volatility.
High domestic energy, labour and logistics costs limited the pass-through of any softening in global commodities for oils, fats and sugar.
Shaun Allen, chief executive of Prestige Purchasing, said: “The 1.1% month-on-month surge in December was a stark reminder of the volatility that continues to plague the supply chain. While global indices for sugar and vegetable oils showed signs of easing in 2025, the reality for UK operators was very different.
“Acute supply shocks – from avian flu in poultry and eggs to climate-driven shortages in coffee and cocoa – combined with high domestic operational costs to drive prices up significantly just as the sector needed stability the most.”
Reuben Pullan, senior insight consultant at NIQ, added: “Another spike in pricing was an unwelcome end to a tough year of trading for hospitality.
“Coming alongside sharp rises in other areas, food and drink inflation is piling yet more pressure on operators’ profitability, while forced menu rises are impacting the spending confidence of their guests.”
