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The body that represents the UK’s food and drinks manufacturers says the new inflation figures show the industry is being “squeezed on all sides”.
The 12-month inflation rate for food and non-alcoholic beverages was 4.9% in July 2025, up from 4.5% in the 12 months to June, according to the Office for National Statistics (ONS).
This was the fourth consecutive increase in the annual rate and the highest recorded since February 2024, however the ONS said this remains “well below” the peak seen in early 2023.
Jim Bligh, from the Food and Drink Federation (FDF), said: “Energy prices remain high, and the cost of some key ingredients has surged in recent years. Cocoa prices are at a 45-year high, and both olive oil and butter prices have doubled since 2020.
“With high commodity prices, the new £1.4 billion packaging tax, and increased National Insurance costs, it’s no surprise that many food and drink manufacturers have seen their costs increase by 10% or more this year.
“Manufacturers have absorbed as many of these costs as possible, but consumers will still see higher prices at the till.
“We expect that high food and drink inflation will persist through the year, so any fresh costs for businesses in the Autumn Budget will inevitably put yet more pressure on shoppers’ pockets.”
