As milk production volumes hit a five-year low in July, dairy prices have been among the biggest contributors to Britain's double-digit food inflation rate. Food inflation has reached 12.8% year-on-year -the highest value recorded since August 2008- fueling a higher-than-expected general consumer price index (CPI) of 10.1%, the Office for National Statistics ( ONS) revealed.
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Dairy products have been hit particularly hard by inflation due to a combination of soaring production costs, stable demand and a long hot spell. According to detailed data published by the ONS, skimmed milk (34%) and whole milk (28.1%) had the highest annual price increase, closely followed by butter (27.1%), cheese (17.9 %), yogurt (14.2%) and ice cream (12.9%); other products, including soy milk, reached 10%. The farmgate price of milk is rising, but farmers are barely keeping pace with increasingly unpredictable input costs, the Agriculture and Horticulture Development Board (AHBD) said recently in its monthly forecast. The body recorded a five-year low in milk production in July, with daily deliveries expected to fall between 1% and 3.8% for the 2022/23 season. The exact number would depend on cost pressures on producers. “We have seen nearly a year of significant input cost inflation, exacerbated by the ongoing conflict in Ukraine,” ...
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