Chicken ‘as dear as beef’... and all prices to keep rising
CHICKEN could match beef in price for the first time in almost 70 years as food prices fly ever higher, supermarket bosses are warning.
The gloomy days ahead for shoppers are being blamed on the cost of raw materials and the impact of inflation rocketing as high as 7.2 per cent.
Asda chairman Lord Rose, a Conservative peer, insists the Government must do more to help tackle the expected surges.
And Steve Murrells, chief executive of Co-op supermarkets, pointed out: “The chicken industry has particular challenges because of the feed costs.”
He explained: “The majority of cattle raised in this country are fed grass and not required to have high-dense feed.
“But chicken, which was incredibly cheap and great value for money, is rising quicker than any other protein. It could become as expensive as beef.” Poultry was last seen as a luxury in the 1950s. But Marks & Spencer free-range chicken breasts and organic British beef rump steak are now both £24.15 a kilo.
And Tesco Finest corn-fed free range chicken fillets are £16.50 a kilo, just shy of its £16.67-a-kilo Finest beef rump steaks.
Chicken prices jumped 19 per cent in the two years to March, beef mince grew three per cent.
But the National Farmers’ Union says the cost of rearing the birds leapt 50 per cent in the past year alone.
Lord Rose told the BBC’s Sunday Morning programme: “It’s going to be very hard and I see no quick solution. Chicken feed is going up and all the other associated costs are going up.
“Pasta is made from durum wheat, and durum wheat has gone up in price, so that’s an inevitable cost increase.
“What we all now have to do is maybe change our behaviour. I will personally look at what things I need and what things I don’t need. “The Government can’t sort out all the problems but it could talk to the food retailers to make sure that we are cutting out every extra cost.” The former M&S chief executive admitted tackling the problems will not be easy, saying: “All of us, need to think of ways to make this better. At the end of the day, sadly, the consumer will also suffer. We don’t know what will happen to gas prices and clearly that will be dictated by however long this war goes on for, but I am afraid there is a knock-on effect for all raw materials.
“There is going to be a new level of costs for these raw materials.
“It is a new high and that is something people are going to have to accommodate.
“What we are now going to have to think about is the long-term effect on inflation. The Government has got a very difficult and tricky road to navigate.”
Lord Rose claimed retailers “will do what we can” to shield customers from raw materials cost increases, but added they were “not immune from cost increases ourselves” and would pass them on.
Oil and gas were already surging before Russia’s war on Ukraine but that conflict has resulted in pushing prices even higher.
The invaded nation produced more sun
flower seeds than any other until this year but there is now a global shortage of sunflower oil. One of its by-products – soya – is often used in bird feed.
Meanwhile, wheat prices are up 35 per cent year on year and palm oil 40 per cent, both used across a huge range of foodstuffs. A resurgence of Covid in China has also blocked supply lines of other goods.
Producer prices for core staples, such as milk and pork, climbed 20 per cent by the end of March and are hitting consumers now. Tesco will pass on to shoppers this month the milk increase.
Across all supermarkets, the bill for butter will leap by a fifth in the next few weeks – and by a staggering 60 per cent by the end of the year.
Kwasi Kwarteng insisted uncontrolled inflation would not necessarily go on for years but admitted no one knows when it will peak.The Business Secretary said: “It’s a global issue – every economy in the world is looking at high prices and greater inflation.”
He claimed the Government is “dealing with it by creating jobs” and the “energy security strategy” – including new nuclear and offshore wind power generation – could help to arrest surges in energy prices.
Charles Hall, head of research at retail analysts Peel Hunt, said: “The 30-year improvement in living standards due to stable and reducing food prices is reversing.
“Food is returning to a material proportion of consumer spend as inflation is likely to top 10 per cent. This will result in a sharp increase in food poverty in the UK.”