There is an inevitability to retail food price increases over the coming months, Food Drink Ireland (FDI) has said. The Ibec body represents food, drink and non-food grocery manufacturers and suppliers.

FDI director Paul Kelly told the Irish Farmers Journal that the level of cost increase which is coming in at all levels of the supply chain, “is such that nobody can absorb those costs”.

When asked if the political and public mood towards retailers, when farmers are being squeezed between rising cost inflation and stagnate food prices, will mean that retailer prices will have to give, Kelly said that no one along the supply chain is “insulated or isolated” from cost increases and suggested that it is “very hard to see” prices not increasing.

The FDI director described how there is generally a “six-month lag between commodity input inflation and food price inflation”.

He said that the food price inflation of 2% in recent weeks is behind the 5% inflation seen in other areas of the economy. However, Kelly warned that the cost of flour has increased by 40% alone over the last fortnight, the magnitude of which is “different than anything seen before”.

While at this stage of the war in Ukraine, FDI has “no great concerns” around food supply, Kelly said that vegetable oil supply is becoming “extremely problematic very quick” as Ukraine is one of the biggest producers of vegetable oil globally.

He explained that the product is used in many foodstuffs and said there may be regulatory issues if alternatives have to be used.