Grocery price inflation at supermarkets rises to fastest since late 2014

Grocery price inflation is climbing by an annual rate of 3.1%, the fastest pace since late 2014, market researcher Kantar has said.

Its regular survey, which is based on 30,000 grocery items bought by 5,000 households in the Irish Republic, also shows that Aldi and Dunnes put on the largest year-on-year growth spurts in the 12 weeks through June 16.

Households spent over €2.54bn on grocery items in that period, “a robust” increase of 4.6% from the comparable period a year earlier.

The market researcher in its latest survey does not ascribe reasons but says that the last time that grocery price inflation matched 3.1% was in October 2014.

Irish grocery price inflation had for some time been subdued following the slump in sterling against the euro when the UK voted three years ago to leave the EU.

Irish supermarkets import many grocery items from Britain but it appears that the benign effect of the strong euro against sterling has worked its way through.

Aldi and Dunnes posted the largest increases in their market shares in the latest survey.

With a share of 22.1%, Dunnes secured the largest bite of the €2.54bn spent in the period, pipping Tesco’s 22% share, while SuperValu secured a share of 21.1% of the spend.

Aldi continued its recent growth spurt to achieve a share of the spend at 12.3%, ahead of Lidl’s 11.7%.

Kantar said that the year-on-year patterns of spending were affected by the 2018 World Cup, as well as last month’s variable weather.

Last June was one of the hottest in years, with over 100 more hours of sunshine than the year before.

"The first half of June this year has been a different story, with fewer opportunities to sunbathe and socialise outdoors.

"This has led to sales of ice cream and sun care products declining dramatically on last year — down 9.2% and 38% respectively,” said the firm’s consumer insight director Douglas Faughnan.

“Drinks sales have also experienced a slowdown. While cider was a particularly popular choice this time last year, its current growth of 0.1% is considerably lower than the 14% experienced last summer,” he said.

Kantar said the growth in market shares by Aldi and Lidl showed “no sign of abating”, while SuperValu’s growth spurt “was the highest rate the retailer has seen since August 2018”.