J Sainsbury PLC (LSE:SBRY) has given British shoppers some relief on their basket costs by reducing the price of its salted and unsalted butter, with 250g packets dropping from £1.99 to £1.89 starting this Tuesday.
It comes at a time of 45-year high UK food inflation, despite a general decline in global wholesale food prices, though as stated by the British Retail Consortium in April, wholesale price reductions can take up to nine months before trickling into grocery stores
Sainsbury’s will also be reducing the price of some of its own-brand bread from 85p to 75p, a month after a skirmish over the price of milk played out among Tesco, Sainsbury’s, Asda and Lidl.
"Whenever we are paying less for the products we buy from our suppliers, we will pass those savings on to customers," a Sainsbury’s spokesperson said.
However, there may also be reputational reasons behind today’s price cuts after the National Farmers' Union (NFU) today lashed out at Britain’s major grocery chains, accusing them of hiking food prices without passing profits to the nation’s producers.
Ali Capper, chair of the NFU's horticultural board, expressed concern that growers were facing a 23% rise in production costs while only receiving a 0.8% increase in payment.
“There is something fundamentally wrong. It’s not fair that the shopper is being charged 27, 25 per cent, 46 per cent more for apples and yet that increase in price is not coming back down to the growers,” she told BBC Radio 4’s Today programme.
The NFU's criticism aligns with the challenges faced by consumers amid high inflation and interest rates, as uncertainties surrounding energy support and rising household bills continue to impact spending habits.
Responding to a comment that said supermarkets are also feeling the inflation squeeze, Capper stated: “They are all still making a profit. The growers that I represent are not. They are all losing money, they are having to take out orchards, they can’t afford to replant them, some of the businesses are actually going under.”