Bulletin: ‘Good Food Cycle’ plan published

Good Food Cycle

The Government has now published the Good Food Cycle - setting out the next steps to deliver the Food Strategy. It has set out ten priority outcomes which are intended to enable good growth, access to healthier and more affordable food, a sustainable and resilient supply chain and vibrant food cultures.

As part of the IGD’s role as co-secretariat to the Food Strategy Advisory Board, we have produced an easy-to-read three minute summary of the document.

See our latest article, Uniting the food sector to deliver a Good Food Cycle.

Inflation concern

The ONS has reported that all items inflation in June 2025 was 3.6% year-on-year, when measured by the CPI method. This marked an increase from 3.4% the previous month, mainly due to an increase in motor fuel and other transport prices.

Food inflation increased for the third consecutive month, reaching 4.5% - up slightly from 4.4% in May. This increase was driven by higher prices for bread and cereals (particularly cakes), meat, and milk, cheese and eggs. It marks the highest rate recorded since February 2024.

See our latest article, Food price inflation still rising.

IGD opinion

Inflation tends to damp-down consumer confidence and volume demand, even in non-discretionary markets like food and drink.

Ongoing inflation is suppressing business recovery from previous shocks, and this is reflected in IGD’s recent forecasts for both retail and Away from Home, which are very cautious.

How high will food prices go?

Get our new food inflation forecasts first when the new Viewpoint report: UK food inflation forecasts 2025–2027, is published on Monday 21 July. Sign up now to stay ahead.

HFSS rules are evolving

The Nutrient Profiling Model (NPM) plays a major role in determining which products are classified as high in fat, sugar and salt (HFSS) across the UK, impacting where and how they can be promoted. With the government proposing to update the current model to a stricter version, food and drink businesses could face restrictions on more products than they currently do, particularly impacting the Drinks category.

Read our latest article to understand what the NPM is, what’s changing, and what food and drink professionals should do now to stay ahead of regulation and support healthier food environments.

UK climate change and droughts

The Met Office has reported that the UK’s climate continues to change. Key findings include:

• The most recent decade 2015–2024 has been 2% wetter than 1991–2020 and 10% wetter than 1961–1990

• Since the 1980s, the UK has been warming at a rate of approximately 0.25°C per decade. The most recent decade 2015–2024 has been 0.41°C warmer than 1991–2020 and 1.24°C warmer than 1961–1990

• Extreme weather events are to be expected each year as an integral part of the UK's climate.

The National Drought Group has declared droughts in further areas, including the West and East Midlands. A hosepipe ban is set to be introduced from 22nd July by Thames Water.  It states “without further rain, the agricultural community are facing a range of challenges due to the dry weather including concerns about irrigation reservoir levels. It is likely that yields will be lower than last year, particularly non-irrigated grains and straw.”  

See our article Drought to downpour: The food system challenge for further details.

IGD opinion

The food system isn’t just exposed—it’s built for a climate that no longer exists. Drought is now the dominant threat, especially in southern Europe. Spain could see nine-times more days of severe drought by 2050 compared to 1990. The risk is not only environmental—it’s financially unsustainable. Businesses must act now.

Unemployment rises in cooling labour market

New labour market data from the ONS (to May 2025) shows a mixed picture. The unemployment rate has risen again and now stands at 4.7%, or approximately 1.7 million people. This marks a steady increase from 4.1% in July 2024, with 124,000 more people unemployed over the past year.

At the same time, there are signs of resilience: the number of people in employment is rising, and average pay continues to grow in real terms, although the pace of growth is slowing.

IGD opinion

While ONS data has limitations—particularly due to low survey participation, the data available is worrying, giving the impression of an economy in the doldrums.

Over the past 12 months, the number in work has fallen by 135,000, a 0.4% drop - comparable to demobilising the entire UK regular armed forces in a year.

With vacancies dwindling and business recruitment intentions weakening, the path back to work for the unemployed is narrowing.

This is a growing social and economic problem, but one that is happening in slow motion and therefore not necessarily obvious.

Green taxonomy plan update

The UK government has confirmed it will not proceed with a UK Taxonomy as part of its sustainable finance framework, following consultation feedback. While reaffirming its ambition to lead the global clean energy transition, the government concluded that other tools and policies would better accelerate investment and prevent greenwashing. Focus will now shift to delivering high-impact measures aligned with investor needs and environmental targets.