‘Golden era’ of cheap food is ending, says ex-Sainsbury’s boss

GingerTim

"King warned shoppers would have to start making hard choices on how they spend their money, particularly as soaring inflation – made worse by the ripple effects of the war in Ukraine – pushed up prices on supermarket shelves. The Bank of England said last week headline inflation was likely to exceed 10% this year, the highest since 1982.

“We have been perhaps through a golden era. We spend much less as a proportion on average of our household budgets on food than we had almost any time in history, and that’s been [on] a long, gentle decline. So I suspect what we will see is a higher proportion, across the piece, spent on food for the longer term.

“It won’t actually be that high in historical terms but it will require adjustments in terms of how we all prioritise our family budget spending,” King added."

https://www.theguardian.com/business/2022/may/13/cost-of-living-golden-era-of-cheap-food-over

Rosa_Damascena

This always used to be the case prior to the 1960s/70s. A couple of graphs from the WEF to illustrate our immense privilege living with a higher proportion of disposable income, which is changing so fast its coming as a shock:

rhcp

I doubt it will be the end to the golden era of Sainsbury's profits.  All these companies seem to do well out of the cost of living crisis.

Cornucopia

It would be nice to understand what Justin King is basing his comments on, because I'm not convinced he's right about this being a new long-term trend.

arnoldy

But  the reality is food is astonishingly cheap still. Beef mince £1.89/0.5Kg, Carrots and onions 50-60p/Kg. Celery 39p. Bread 50p/800g. Potatoes 30-40p kg.

Not sure what all the fuss is about.

Rosa_Damascena

arnoldy said:

But  the reality is food is astonishingly cheap still. Beef mince £1.89/0.5Kg, Carrots and onions 50-60p/Kg. Celery 39p. Bread 50p/800g. Potatoes 30-40p kg.

Not sure what all the fuss is about.

1kg of carrots has cost me btwn 40-48p for years now. It's a staple for me, and every time a bag goes into my basket I marvel at just how inexpensive they are.

FWIW, I think Justin King is right. Prices may drop seasonally, but I'm pretty sure this is a long-term trend. One things is for certain though, and that is it's not going to be the supermarkets taking the hit.

rhcp

Peas have gone down in price as well.  A 1kg pack of frozen peas used to be about £1, now they are around 55p.

Rosa_Damascena

I don't think anyone could argue that peas and carrots are unhealthy food choices. But will the nation change its eating habits?

MattMattMattUK

rhcp said:

I doubt it will be the end to the golden era of Sainsbury's profits.  All these companies seem to do well out of the cost of living crisis.

The supermarkets make fairly small margins, especially on food, the reason the headline profits figure of "billions" sounds large is because of the scale of their operations. The thing is, if they made zero profit food bills would only reduce by a few percent at most.

PennyForThem_2

Cooking knowledge is crucial.  A kilo of carrots is useless/wasted if you do not know how to cook it into a meal.

London_1

A kilo of carrots will give me a large vat of spicy carrot and coriander soup for very little outlay a good five portions for lunch or as a startes before my evening meal