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Weak pound contributes to retail price rises

Unfavourable post-referendum exchange rates one of several factors driving price rises in grapes and apples among other products

Weak pound contributes to retail price rises

Peruvian grape exporters have been hard hit by post-Brexit currency volatility

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The devaluation of the pound, combined with various other factors, has pushed up prices on several fruit and veg products since last year’s Brexit referendum, according to exclusive data commissioned by the FPJ. 

Apples and grapes in particular have been subject to retail price rises over the past twelve months, with 1kg bags of braeburn at Lidl going up 27 per cent in the 52 weeks to 5 July, according to figures provided by Produce View.

Other notable price hikes were seen in 500g punnets of both white and red grapes at Aldi, which went up 22 per cent; 500g punnets of red and white grapes at Asda, which rose 20 per cent; and 750g packs of tomatoes at Morrisons, which went up 49 per cent – from 92p to £1.37.

Less extensive price rises were also seen on certain products in the easy peeler, onion, pepper, mushroom and cucumber categories.

Commenting on the price rises in grapes, Geoff Green of fresh produce supplier Capespan said Peru had been the sourcing region hardest hit by Brexit-related currency fluctuation “because Peruvian exporters already had the highest price expectations across the year”.

This, combined with the fact the South American country suffered big losses in yield last year due to El Niño, could reduce the volume of Peruvian grapes sent to the UK this year, Green expects.

Green also attributed certain price rises to a delay to the start of the Egyptian season but insisted that the main factor influencing the grape market at present was an increase in production yields following strong supply in successive seasons in South Africa, Chile, India and Egypt.

“South African exports to Europe as a whole were significantly higher this year and that’s created a lot of price competition this year between Chile, South Africa, Egypt purely due to volume pressure,” he said.

There was speculation from some in the industry that certain retailers may be using Brexit as an excuse to increase prices on certain products, with Edward Fleming of importer/exporter Jem Fruits saying he thought “some supermarkets were milking it and some weren’t”.

Fleming, who supplies grapes to wholesalers, caterers and food processors, said he had not experienced higher prices himself, stressing that the weakness of the pound was only one of many factors affecting prices.

“There are a lot of different factors at work here,” he said. “It’s easy to sit here and say that the Brexit vote and the bad election scenario have affected this and that, but there are a lot of other factors that have affected prices anyway.

“The weakness of the pound is certainly a big factor but there are lots of other factors as well. Worldwide demand for product is up and that has definitely affected the supply to the UK and Europe.”

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