Despite the slight fall of 0.9 percentage points, inflation remains only just below the Index’s previous peak of 22.9% in December 2022.
The latest Index also reports a month-on-month increase of 0.7%—in contrast to supermarkets, where prices fell by 0.4% between June and July.
Prestige Purchasing chief executive Shaun Allen said: “Food and drink supply into hospitality has been slower to react to falling input costs than the retail sector.
“We are confident that over the remainder of the year inflation will begin to ease at our kitchen doors, but both buyers and suppliers will need to play their part in curbing the continually rising costs that threaten the existence of so many of our sector’s brilliant operators.”
The monthly monitor from CGA and Prestige showed signs that some foodservice prices were starting to ease.
The fish category recorded a 0.8% fall – its first month-on-month drop since July 2022.
Dairy prices remained stable, and the month-on-month increase in the vegetables category slowed by half, from 3.2% in June to 1.6% in July.
While the cost of global food commodities rose by 1.3% in July, the UN FAO Commodity Index remains 11.8% below its value in the corresponding month in 2022.
Brent crude oil prices and major currency rates remained stable throughout July.
However, inflation is falling more slowly in the category of food products, where processed items dominate and manufacturers remain exposed to high inflationary inputs including energy and labour.
Many of these products are also imported and have accrued additional costs from post-Brexit trading arrangements.
CGA by NIQ client director James Ashurst said: “Businesses will be relieved to see a slight easing of inflation in July, and there are some welcome early signs of relief in key spending areas for both operators and consumers.
“However, with inflation still topping 20%, trading conditions remain extremely challenging. It is especially frustrating at a time when prices are easing in the retail sector, and reinforces the case for targeted government support for hospitality businesses.”