18th August 2026
There is something rather deceptive about the price of food at the moment.
Walk into a supermarket and it is not immediately obvious that Britain is facing a potentially difficult combination of drought, poor harvest prospects, rising energy costs and an oil price that has climbed back above $90 a barrel.
Food inflation was just 1.7% in June. After the extraordinary increases of the cost-of-living crisis, that might sound like welcome news. Indeed, supermarkets have been working hard to keep prices competitive, absorbing some costs and using promotions to prevent shoppers from walking away.
But there is a danger in assuming that today's supermarket prices tell us what food will cost next year.
Agriculture does not work on a monthly timetable.
What happens to a crop today can determine the price of food several months later. What happens to the price of diesel, fertiliser or animal feed today can take even longer to work through the food chain.
And that is why Britain's exceptionally dry summer deserves more attention than it is perhaps receiving.
The drought is already affecting the harvest and the problem is not simply that farmers would like a little more rain.
The prolonged period of heat and dryness has reduced grass growth, affected crops and reduced the availability of forage for livestock. The Government has warned farmers that water supplies are under pressure and that the dry conditions are placing significant pressure on farm businesses.
England has been particularly badly affected. Almost three-quarters of England is now classified as being in drought, according to recent reporting, while farmers have been warning about the consequences for crops and livestock.
Vegetable growers are already seeing the consequences and reports suggest wholesale prices have risen dramatically for some products, including potatoes, tomatoes and iceberg lettuce. The problem is not necessarily that Britain has suddenly run out of food. It is that yields are falling, production costs are rising and retailers are increasingly having to look elsewhere for supplies.
That is an important distinction as a food shortage does not necessarily mean empty supermarket shelves.
It can mean that the food is still there — but it costs considerably more to produce or import.
Then there is the oil price and this is where the story becomes more worrying. Brent crude has climbed to around $91 a barrel, with the Middle East conflict and concerns over disruption to oil supplies continuing to unsettle the market.
Oil is not just about the price displayed on the petrol station forecourt.
It is woven through almost every stage of modern food production.
A farmer needs diesel to operate tractors and combines. Fertiliser production is heavily dependent on energy prices. Food processors need energy. Refrigerated warehouses consume energy. Lorries move food around the country. Fishing boats need fuel. Packaging uses petrochemical products.
So when oil rises, the food system does not receive one additional bill.
It receives many.
Defra is already reporting that farmers are facing higher fertiliser and red-diesel costs alongside the effects of drought.
That creates an uncomfortable combination.
The drought can reduce the quantity of food produced while higher oil and energy prices increase the cost of producing every unit that remains.
The supermarket may hide the problem — for a while
There is another reason why consumers should not necessarily expect an immediate explosion in food inflation.
Supermarkets have considerable buying power. They can negotiate with suppliers, switch between domestic and overseas sources, absorb some costs and use their own margins to keep headline prices down.
That is precisely what has happened recently.
Reuters reported in August that UK food inflation had remained remarkably subdued despite earlier fears of a much larger increase. Competition between supermarkets and pressure on suppliers have helped hold prices down.
But supermarkets cannot absorb every increase indefinitely.
Eventually somebody in the supply chain has to pay.
If the farmer's costs rise, the processor's costs rise and transport costs rise, there is a limit to how long the supermarket can simply absorb the difference.
And even when the supermarket does absorb some of it, there is another consequence.
Its profit margin becomes smaller.
That can eventually result in higher prices, reduced promotions or changes in the products being stocked.
The supermarket shelf can therefore give a false sense of security.
The pressures may already be building underneath it.
The harvest is the critical point
This year's harvest could be particularly important.
Early estimates suggest that several major arable crops are performing below their normal long-term yields. The provisional wheat yield estimate, for example, has been described as notably low, while drought and heat have affected other crops.
That matters far beyond the price of a bag of flour.
Wheat is part of an enormous food chain.
It affects bread, flour, biscuits, cakes and other processed foods. It is also important as an animal feed ingredient.
A poor cereal harvest therefore has the potential to work its way through several different parts of the food economy.
And there is another problem in that if British production falls, Britain can import more.
But importing food does not mean avoiding the cost. Someone still has to pay the international commodity price, transport costs, insurance, refrigeration, fuel and the exchange-rate cost of bringing it into Britain.
Britain's ability to import food is an enormous advantage in a shortage.
But imports are not free insurance.
For Scotland, the picture is more complicated as the worst drought conditions have been concentrated in England, but Scotland has also experienced dry conditions and agricultural pressures. The Scottish Government has already warned that climate change could put increasing pressure on water supplies, soils, crops and livestock.
Scotland could therefore find itself in an unusual position.
If English production is badly affected, Scottish agriculture could become relatively more important to the UK food supply.
But Scottish farmers are not immune from rising costs and Scottish consumers are part of the same UK and international food market.
If Britain has to compete internationally for replacement supplies, Scottish shoppers will generally face the same underlying commodity prices as everyone else.
There is also a geographical issue as for people living in remote and rural areas, food already travels considerable distances before it reaches the supermarket.
That makes transport costs particularly relevant.
A rise in diesel prices may be only a small part of the final price of a loaf of bread. But when transport costs rise across an entire distribution network, those pennies accumulate.
And for households already struggling with the cost of living, a few extra pounds on the weekly shopping bill can matter.
The real danger may be the combination
This is why looking at drought and oil separately misses the bigger picture.
Imagine a farmer facing a poor harvest.
At the same time, Diesel is more expensive, Fertiliser is more expensive, Machinery is more expensive to operate, Animal feed is more expensive, Transport is more expensive.
And if the farmer needs to buy feed because drought has reduced grass and forage, the problem becomes even more acute.
This is not one inflationary pressure.
It is several pressures reinforcing each other.
The United Nations Food and Agriculture Organization has already warned that the world could be heading towards another period of food inflation, with wars, weather conditions and the possibility of El Niño combining to threaten supplies and increase costs.
That is the part that should make policymakers nervous.
Britain does not have to experience a catastrophic harvest for food prices to rise sharply.
It only needs several moderately bad things to happen at the same time.
Could oil actually reach $100?
That is certainly possible, although nobody can say with confidence that it will.
Brent is already around $91. A further escalation of the Middle East crisis, particularly anything that seriously restricts oil shipments through the Strait of Hormuz, could push the market considerably higher.
If oil reached $100, it would not automatically mean that food prices rose by some equivalent percentage.
The relationship is much more complicated than that.
But it would add another significant cost to an agricultural system already dealing with drought.
And if oil went substantially beyond $100, the consequences would become harder to contain.
That is where the possibility of a second cost-of-living shock begins to emerge.
We should remember how much food prices have already risen
There is another reason consumers may be particularly vulnerable.
Food prices have already increased enormously since the beginning of the cost-of-living crisis.
The House of Commons Library calculates that UK food and non-alcoholic drink prices rose by 38.6% between November 2020 and November 2025.
So even if food inflation is only 3% or 4%, it is being applied to a price level that is already substantially higher than it was five years ago.
That is an important point which can get lost when politicians talk about inflation "falling".
Falling inflation does not mean food prices are falling.
It means they are rising more slowly.
A family paying £100 for a basket of groceries does not get that £100 back because inflation falls from 8% to 2%.
The higher price becomes the new starting point.
So what might happen over the next year?
Nobody can give us a reliable figure today.
There are simply too many variables.
Rainfall could return.
Oil could fall.
Global harvests could be better than expected.
Supermarkets could continue absorbing costs.
Or the opposite could happen.
Drought could persist.
The next growing season could also be poor.
Oil could move through $100.
International food prices could rise.
And another weather event elsewhere in the world could reduce the supply of a commodity Britain normally imports.
The Institute of Grocery Distribution currently forecasts UK retail food and drink inflation of around 3.1% to 4.1% in 2027, but explicitly identifies weather disruption, energy, geopolitics and supply chains as significant upside risks.
That may prove a reasonable central forecast.
But the interesting question is what happens if several of those risks arrive together.
Britain isn't facing famine. It may be facing something more familiar.
It is important not to exaggerate the situation.
Britain is not on the verge of running out of food.
The country has sophisticated supermarkets, international supply chains, substantial purchasing power and the ability to import products when domestic production falls.
But food security is not simply about whether there is enough food.
It is also about whether people can afford it.
That distinction matters enormously.
For a wealthy household, another £10 or £15 on the weekly shop may be irritating.
For a family already struggling with rent, mortgages, council tax, heating and transport, it can mean something else has to go.
And for pensioners living on fixed incomes, repeated increases in food and energy prices can be particularly difficult to absorb.
The warning may therefore be hiding in plain sight
Perhaps the most important thing about the current situation is that we should not look only at today's supermarket inflation figure.
We should look at what is happening behind the checkout.
Farmers are dealing with drought.
Harvest prospects are being revised.
Some wholesale food prices have already risen sharply.
Fertiliser and diesel costs are higher.
Oil is around $90 and could go higher.
Global food prices are also beginning to respond to weather and geopolitical pressures.
None of these facts guarantees another food-price crisis.
But together they create the ingredients for one.
The irony is that consumers may only discover how serious the problem has become when they are standing in the supermarket sometime during the winter or next spring.
By then, the lack of rain that damaged a crop months earlier will be old news.
The oil tanker sailing through a troubled part of the world will be far away.
The farmer who harvested less grain will already have moved on to the next season.
But the bill will have arrived.
And it will arrive, as these things usually do, at the supermarket checkout.
For Britain, the next food shock may not begin with empty shelves.
It may begin with shelves that look perfectly normal — but cost rather more to fill.