The former CEO of Sainsbury’s has said “the worst is yet to come” for food prices amid fears that “double digit” inflation could last longer than a year.
Speaking to LBC, Justin King said the UK was likely to see “significant food price rises” as grocery analysts warned of a 15 per cent jump over the summer.
“It was my view, expressed publicly 6 months ago when the Bank of England felt that it would be around 5 per cent and relatively short lived, that it would be closer to 10 per cent and long-lived, and I think we’re seeing that even I was under-calling it.
“We’re definitely going to see double digit food inflation, and I think very likely it will persist for a longer period of time than just a year or so.”
Mr King noted that the weakness of the pound could be behind the price rises, as the UK buys a lot of food in euros and dollars.
“The impacts of energy price rises, and the very significant impact on availability of core commodities such as oil and wheat, and so on... they haven’t found their way through the food price system yet,” he said.
“They are working their way through to prices and will be very significant.”
A report released on Thursday by the Institute of Grocery Distribution (IGD) warned that food prices could increase as much as 15 per cent over the summer.
IGD have reported that factors including uncontrolled increases in labour costs, trade disruptions caused by Brexit and the weakening of the sterling against other currencies could be behind the rising inflation rate.
James Walton, the chief economist at IGD, said: “We are already seeing households skipping meals, a clear indictor of food stress.”
Tesco bosses on Friday warned they were seeing “early indications of changing customer behaviour” due to pressure on households from soaring inflation.
Ken Murphy, chief executive of the business, highlighted “unprecedented increases” in the cost of living for customers.
Mr Murphy said Tesco had seen an increase in shoppers turning to own-label products with staples such as bread, pasta and baked beans as they have sought to reduce their weekly shopping bills.
