Food inflation may have eased slightly in February, but food and drink producers are warning that tougher times could lie ahead. The Food and Drink Federation (FDF) has raised concerns about the escalating impact of the conflict in the Middle East, cautioning that the latest figures could be “the calm before the storm.”
Despite a modest easing to 3.3% in annual food and non-alcoholic drink inflation, down from 3.6% in January, the sector remains under significant pressure. Rising costs for energy, transport fuel and shipping are expected to push prices higher in the coming months.
Karen Betts, Chief Executive of the Food and Drink Federation, said: “While food inflation fell slightly in February 2026, I am concerned that this is the calm before the storm. The longer the conflict in the Middle East goes on, the bigger its impact will be on food prices.
“With food and drink price inflation already running above historical averages, heightened energy, maritime fuel and fertiliser costs will put further pressure on prices.
“Food and drink is an essential, bought by every household, every week. While it can take several months for cost rises to filter fully through to shop shelves, the cost of the Iran conflict will be felt by shoppers this year.
“If government is serious about tackling the rising cost of living, it must provide our industry with at least the same support as other manufacturing sectors. The current energy shock is yet another structural shock our industry will have to absorb, on top of the Ukraine war, the costs of realigning food law with the EU once again, and new regulatory burdens.”
The latest data shows that food and non-alcoholic drink prices were unchanged on a monthly basis in February. Prices fell for nine product categories, with the steepest drops seen in olive oil (-10.4%), flours (-8.3%) and pizza (-4.9%).
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However, several staples saw notable price increases. Beef and veal rose by 20.6%, offal by 17.0%, and whole milk by 13.1%.
Industry reports also highlight surging transport costs, with UK haulage companies introducing an Emergency Fuel Surcharge of up to 20%. Ocean freight lines have added an Emergency Bunker Surcharge of around USD $400 per container to cover higher oil costs, costs that may ultimately be passed on to consumers.
