Goods could face post-Brexit delays at United Kingdom ports

A seasonal crop of home grown fruit and vegetables is helping to cushion supermarket shoppers from the effect of inflation, new figures suggest.

In its latest BRC - Nielsen Shop Price Index, the consortium found that overall shop price deflation was 0.3 per cent in August, a slight deceleration from the 0.4 per cent fall in July.

Overall, shop prices fell by 0.3% in August compared to the same month past year, thanks to fierce competition between non-food retailers.

BRC, the trade association for the retail market, said that while the government's position paper "rightly acknowledges the need for a strong customs agreement", it hasn't yet addressed the "significant investment required in the UK's ports, roads and infrastructure to get systems ready for Brexit day and thereafter" or the "suite of new agreements supplementing customs that are necessary to side-step additional red tape at ports and docks and prevent delays to goods".

But within this, fresh food inflation slowed for the second month in a row, to 0.8%, from 1% the month before.

Four million trucks now cross the UK's borders annually and the cost of holding a delayed driver with a refrigerated lorry at a port for one day is £500, according to the BRC.

Dickinson added that border controls could lead to a shortage of certain food items, highlighting the need for the government to secure a wide-ranging agreement covering key issues such as security, transit, drivers and value added tax.

"Whilst consumer sentiment is on the turn and shoppers are becoming cautious about spending on big ticket items, prices are still very competitive on the high street and spend on food and drink has been strong over the summer, albeit disrupted by the changeable weather in August".

"However, as winter approaches and our dependence shifts to imported goods, that will change".

Except for June of this year, this is the shallowest deflation rate since November 2013.

Ms Dickinson said measures put in place before the pound's sharp fall a year ago to smooth out the effect of currency volatility were now coming to an end - leaving retailers little option but to pass on the higher cost of imports.

"While the dynamics of individual elements of the index play out in different ways from month to month, the fact is that the overall pressures on prices are still weighted upwards".

Food and drink will be the hardest hit by any delays, with 79% of all food and drink imported into the United Kingdom coming from the EU. "That will put an increasing strain on already stretched family budgets".

The report, which warns of product shortages across the board, claims short shelf life food is most at risk of disruption because of the decision to quit the EU.