Prices in the food service industry jumped by 21.6% year-on-year in May, according to trade body the CGA’s food service price index (FPI).
There were hopes the FPI would start falling in May after inflation in the industry began easing in the first quarter of 2023, but this has not been the case.
May’s figures closed the gap to December’s record high of 22.9% and ticked up above April’s 21.4%.
Increases were driven by the price of bread, sugar and vegetables, all of which rose by around 3% month-on-month.
“With the cost-of-living crisis increasingly impacting the volume of diners in a negative way, the hospitality sector is now facing an increasingly difficult challenge to maintain acceptable margins,” CGA’s report said.
In May last year, FPI came in at 10.2% meaning prices are now 34% higher than two years ago.
Globally, food commodity prices have been dropping for well over a year, according to the FAO world food price index.
Prices were recorded as being 22% lower than in March 2022 when the Ukraine invasion sent the index to all-time highs.
Some experts believe that because of increases in freight costs and companies having entered fixed-price contracts last year, there could be a lag between the global and food service prices.