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UK food price inflation is expected to accelerate over the coming year, potentially reaching 6.4% by mid-2027 as geopolitical tensions, extreme weather and higher production costs pressure the food industry, according to the Food and Drink Federation (FDF).
The trade body forecasts prices for food and non-alcoholic beverages will be 3.9% higher year-on-year in December 2026. That is substantially below its previous estimate of nearly 10%, but the FDF expects inflation to continue rising afterward and peak at 6.4% in July 2027.
The outlook reflects several pressures, including the ongoing U.S.-Iran war, drought conditions across Europe and the El Niño weather pattern. Higher energy, logistics and packaging expenses are also expected to feed through to consumers.
FDF Chief Executive Karen Betts said manufacturers have worked to limit price increases despite an energy shock linked to the closure of the Strait of Hormuz. However, she warned that companies cannot absorb elevated costs indefinitely, particularly after extreme summer heat added further strain to food production.
The FDF expects UK food inflation to remain well above historical averages during the second half of 2027. Compared with its April forecast, the organization now anticipates a lower inflation peak but a more prolonged period of elevated prices.
Official data from the Office for National Statistics showed food and non-alcoholic drink inflation eased to 1.3% in July, its lowest level since August 2024. Overall UK consumer price inflation stood at 2.9%.
The Bank of England forecasts food inflation will rise to 3.5% by December, while headline CPI is expected to reach 3.1%. The central bank considers food and energy costs particularly important because they strongly influence households’ perceptions of inflation.
Food and drink prices have already climbed nearly 40% since 2020, according to the FDF.
The industry group also urged the UK government to pause planned restrictions on marketing foods classified as unhealthy. It said higher payroll taxes and stricter advertising and packaging regulations added £2 billion ($2.7 billion) to industry costs last year.
