Hospitality inflation inches up to 2% in March

Oils and fats remain the most inflationary category, up 5.8% from March 2024.

Year-on-year (YoY) inflation in the hospitality sector edged up to 2% in March, according to the CGA Prestige Foodservice Price Index.

The oils and fats category continues to be the most inflationary category, with a 5.8% increase compared to March 2024.

Sugar, jams, syrups, and chocolate also remain subject to inflationary pressures, with a 2.4% YoY rise, partly due to ongoing volatility in cocoa pricing.

Meanwhile, the dairy sector continues to be impacted by challenges in butter and cream production stemming from adverse weather conditions that affected milk quality and volume last year.

Whilst suppliers are not yet indicating price decreases, the second quarter of this year offers a more optimistic outlook with the anticipation of improved milk volumes.

Meat and poultry markets are also facing headwinds, including a tightening of cattle supply, with UK beef production forecast to drop by 5% in 2025.

This fall in production is significantly influencing prices, and as the summer BBQ season approaches, increased demand for popular cuts is expected to amplify pressures.

The chicken market remains volatile due to ongoing avian flu outbreaks in key production regions, causing extended disruptions to supply.

Whilst price increases may be nearing their peak, any subsequent decrease is anticipated to be slow. Avian flu also remains a key driver behind elevated egg prices due to reduced flock sizes.