Food inflation has slowed to its lowest rate since November 2021, despite prices of seafood, tea and coffee remaining high, new data shows.

According to the British Retail Consortium (BRC)-NielsenIQ Shop Price Index, food inflation decelerated to 1.8% in November, down from 1.9% the month before, while ambient food inflation also slowed to 2.7%, down from 3.1%.

However, fresh food inflation accelerated to 1.2%, up from 1% in October as food prices for fresh products such as seafood, which BRC chief executive Helen Dickinson described as “more vulnerable to high import and processing costs, especially during winter” increased.

She added: “Tea prices also remained high as poor harvests in key producing regions continued to impact supply. While coffee prices experienced a momentary dip, price rises are imminent as global coffee prices approach record highs.”

Subscribe to Grocery Gazette for free

Sign up here to get the latest grocery and food news each morning

Meanwhile, November marked the first time in 17 months that shop price inflation has been higher than the previous month, with deflation at 0.6%, up from deflation of 0.8% in October.

NielsenIQ head of retailer and business insight Mike Watkins said: “Shoppers are still being cautious by shopping savvy for the essentials and holding back their discretionary spend, so the lower level of inflation should help sentiment ahead of Black Friday promotions. And with lower inflation than this time last year, many food retailers are extending offers and discounts to help sales momentum in December.”

“With significant price pressures on the horizon, November’s figures may signal the end of falling inflation. The industry faces £7 billion of additional costs in 2025 because of changes to Employers’ National Insurance Contributions, business rates, an increase to the minimum wage and a new packaging levy.

“Retail already operates on slim margins, so these new costs will inevitably lead to higher prices. If the government wants to prevent this, it must reconsider the existing timelines for the new packaging levy, while ensuring any changes to business rates offer a meaningful reduction for all retailers as early as possible.”

Last week, a letter organised by the BRC signed by over 70 companies including Tesco, Sainsbury’s, Asda and Morrisons to Chancellor Rachel Reeves warned that the changes to National Insurance Contributions would make “job losses inevitable, and higher prices a certainty”.