Britain’s supermarkets received a welcome boost this month as grocery price inflation eased further, reducing pressure on households already facing years of elevated food costs.
Supermarket prices were 3% higher in June than a year earlier, down from 3.1% in May and 3.8% in April, according to data from Worldpanel by Numerator.
The slowdown comes despite concerns that renewed tensions in the Middle East could push up costs across global supply chains and eventually feed through to supermarket shelves.
Instead, shoppers have been responding to warmer weather with a distinctly British spending pattern: more barbecues, outdoor dining and seasonal purchases.
The UK’s record-breaking May heatwave triggered a sharp rise in demand for summer products. Sales of sun protection products jumped 128%, while fresh beef burgers increased 40% and fresh prepared salads and chilled dips rose 13%.
No and low-alcohol drinks also continued their rapid growth, with sales increasing 23% compared with a 6% rise across the wider beer and cider category.
Fraser McKevitt, head of retail and consumer insight at Worldpanel, said the warmer weather had transformed the weekly shop.
“Heatwave conditions changed the way shoppers bought food, with barbecue staples and healthier summer options seeing strong demand,” he said.
While inflation is slowing, supermarkets remain locked in an intense battle for customers who have become increasingly focused on value.
Nearly a third of all grocery spending is now made on promotion, according to Worldpanel data, highlighting the pressure retailers face to offer discounts and maintain customer loyalty.
“Retailers are having to compete hard for that summer shop,” McKevitt said.
The increase in promotions reflects a broader shift in consumer behaviour. Shoppers are not necessarily cutting spending entirely, but they are becoming more deliberate about where they buy and how they maximise value.
Online grocery shopping continues to play an important role in that shift, giving consumers greater ability to compare prices and switch between retailers.
The competitive environment has created clear winners and losers among Britain’s biggest supermarket groups.
Ocado was once again the fastest-growing grocer, with sales rising 13.5% over the 12 weeks to June 14 compared with the same period last year.
The Co-operative Group also returned to growth, increasing its market share from 5.2% to 5.3% as sales rose 2.7%, following disruption from last year’s cyberattack.
Tesco, Britain’s largest supermarket chain, maintained its dominant position with a 28% market share and sales growth of 1.2%.
By contrast, Asda continued to struggle, with sales falling 3.6% year on year and its market share declining to 12.1%.
The latest figures suggest the pressure on household budgets may be easing, but the grocery sector remains far from returning to normal.
Consumers are still highly sensitive to prices, while supermarkets face the difficult task of balancing promotions with profitability.
The return of summer spending offers some optimism. When households barbecue, spending per person on food nearly doubles, rising to almost £5 per head compared with just over £2.50 for meals prepared indoors.
But the underlying challenge remains clear: Britain’s supermarkets are competing in an era where customers expect lower prices, greater choice and constant value.
For retailers, the heatwave may have delivered a temporary boost.
The bigger question is whether that confidence can survive once the summer sun fades.
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