UK food inflation could nearly double by 2027, IGD warns

UK food inflation is forecast to climb from 2.9–3.9 percent this year to as much as 5.6–6.6 percent in 2027, according to projections published on September 16 by industry research body IGD.

The forecaster expects the rate to stay elevated into 2028, at 5.3 to 6.3 percent, as extreme weather, rising input costs, supply chain disruption and energy market volatility keep pressure on producers and retailers. Disruption in the Middle East and the risk of an El Niño weather pattern delaying rains in key growing regions were both flagged as additional risks to the outlook.

Fruit and vegetables are expected to contribute the most to the rise, IGD said, because their short production cycles leave them more exposed to a single bad season than longer-cycle staples.

Stock buffers and hedging have delayed, not removed, the pressure building from disrupted energy markets and extreme weather.

UK food inflation meets a tapped-out shopper

The forecast lands on shoppers who have already adjusted as far as they comfortably can. IGD noted that UK households have changed their shopping habits, switched products and cut discretionary spending over the past two years, leaving "fewer options available to absorb any further price rises" once the next wave of increases arrives.

"Stock buffers and hedging have delayed, not removed, the pressure building from disrupted energy markets and extreme weather," said James Walton, IGD's chief economist, framing the current calm in shop prices as temporary rather than a sign the underlying cost pressures have eased.

A call for more domestic supply

Walton argued the clearest way to soften the trajectory is to build more domestic productive capacity and raise productivity across the food system, reducing reliance on imports exposed to the same weather and energy shocks driving the forecast higher. The recommendation echoes a wider debate already under way in UK hospitality, where operators pressing ministers over a hospitality VAT cut have made a similar case that policy, not just weather, will decide how much of the increase reaches menus and tills.

The figures update earlier 2026 data showing UK grocery inflation already accelerating, up to 2.8 percent year on year in August from 2.2 percent in July, with ambient food prices rising fastest of any category as the pressures IGD is now forecasting begin to show through, a dynamic 800 hospitality businesses have already raised with the UK culture secretary this year.