Food prices are likely to rise to above 2020 levels as volumes recover, according to the latest edition of the Foodservice Price Index from CGA and Prestige Purchasing.
Figures for the February 2021 index showed that the total food basket price fell by 2.6% in January 2021, though it was up 2.2% on a year-on-year basis.
There were also notable dips in dairy and fish / seafood prices, caused by Brexit-related falls in export volumes and an EU ban on imports of certain UK shellfish.
Shaun Allen, CEO of Prestige Purchasing, said: “We expect prices to rebound as volumes recover, probably to above 2020 levels by later in the year. Operators would be well advised to seek price holds from suppliers whilst the current inflation levels remain benign.
“They should also avoid taking a renewal of pre-lockdown supply for granted, as the commercial impacts of the winter lockdown have been harmful to many supplier balance sheets.”
Fiona Speakman, CGA client director – food, added: “These figures are reminders that foodservice supply remains volatile, and that the many impacts of both Covid and Brexit will be felt for some time to come. All businesses will need to stay alert to pricing issues if they are to make a positive start to the recovery journey.”