The weakness of sterling is continuing to drive rising food prices in the UK, industry analysts TNS Worldpanel said today (31 March).

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In the 12 weeks to 22 March, food inflation stood at 9.3%, compared with a rate of 8.7% seen in the prior four-week period.


The continuing fragility of the pound is driving commodity prices, TNS said, leading to an increase in grocery prices.


UK grocery sales rose by 5.8% as the market lapped March 2008 figures that included Easter, which fell earlier last year.


“This growth in consumer spending remains below the Grocery price inflation of 9.3% as shoppers continue to seek to manage the impact of higher prices which are still feeding through year-on-year in the Grocery Sector,” TNS director Chris Longbottom said.

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“Shoppers trading down to lower-priced products, especially within the retailers’ own-label ranges, is the main way they are seeking to contain this.”


Asda’s sales were up 8.5% on the year, taking the Wal-Mart arm’s share of the UK market to a “record” 17.5%.


Morrisons, meanwhile, saw its sales climb 7.2%. The UK’s fourth-largest grocer took its share of the market to 11.8%, TNS said.


Tesco, the country’s largest grocer, saw its share of the market dip year-on-year, falling from 30.8% a year ago to 30.4%.


Sainsbury’s share was “constant” at 16.1%, TNS said, after its sales grew by 5.7%.


Discount retailers – Aldi, Lidl and Netto – saw their combined share of the UK market rise from 5.5% a year ago to 5.9%. TNS said “shopper spending” at the three retailers rose 13%.


However, Longbottom suggested that the UK’s larger grocers were having some success meeting the challenge of their cut-price rivals.


“There are some signs of a slowdown in this rate of growth, suggesting that the major multiples are becoming more successful in containing this long-term challenge,” he said.