Store giants apply ‘unfair’ cost squeeze on suppliers, is the lead story in The Times (£) this morning.

Britain’s biggest supermarkets have been accused of treating suppliers unfairly by demanding savings when the pound was strong but refusing to share the burden of higher costs now that sterling has collapsed. Concerns have been raised with the Groceries Code Adjudicator, the supermarket watchdog, that retailers who requested price reductions when suppliers gained from the stronger currency were stonewalling the same suppliers as they struggled to deal with the fall in sterling since the European Union referendum. (The Times £)

The price battle between Unilever and Tesco that led the UK supermarket to delist products such as Marmite and Ben & Jerry’s ice cream proved shortlived but the war over rising food prices is far from over between retailers and their suppliers. Although the dispute was resolved within 24 hours, analysts say it points to an industry-wide problem that is set to reverse two years of falling food prices for British shoppers. (The Financial Times £)

Consumers have been now been warned that spikes in prices on high-street goods could come after the Christmas sales, as retailers’ hedges against currency fluctuations – a form of insurance policy against movements in the pound – come to an end. “We are really going to see things unwinding, and effects on prices from early 2017,” says Patrick O’Brien, analyst at consultancy Verdict Retail. (The Guardian)

Following the slump in the value of the pound induced by the Brexit vote, retailers will not be able to hold back the tide of imported inflation that is soon to swamp consumers. There are worrying implications for Britain’s economy, propped up since the financial crisis by free-spending consumers. If shoppers — who have so far shrugged off the uncertainty triggered by the decision to leave the EU — balk at pricier goods, growth is sure to suffer. (The Times £)

The Times (£) looks at how the dispute between Unilever and Tesco escalated. Finding that more than two-thirds of Unilever’s materials, ranging from palm oil to plastic packaging, are paid for in dollars. The currency crash — driven by talk of “hard Brexit” and withdrawal from the single market — is about to put the squeeze on high-street suppliers as hedges implemented before the vote run out. Unilever told its big customers it wanted to impose a 10% hike across the board to offset the pain. However, the supermarkets asked to go through Unilever’s portfolio, looking at the ingredients for each product and price rises that might be appropriate. Unilever refused to go through the list in detail and “quickly collapsed when they tried to justify it”.

Unilever was on the ‘buy’ list at The Share Centre despite a spat with Tesco last week sending shares lower. Analyst Graham Spooner said sales growth at the consumer goods firm had been better than expected in its third-quarter results, and it is on track to meet its full-year targets. (The Daily Mail)

Britain will face average tariffs of 22% on its food imports from the EU, unless it remains within the single market or strikes a bilateral trade deal following Brexit, the former deputy prime minister Nick Clegg has warned. The analysis counters calls from Conservative backbenchers that Britain should fall back on World Trade Organisation rules to strengthen its bargaining position with the EU. (The Financial Times £)

The weak pound has become an obstacle to high-street takeovers, with JD Sports among those hit by complications caused by the rising cost of imports. Retailers are facing significantly higher import costs and the threat of duty tariffs, which deal-makers say has made their negotiations more difficult. (The Telegraph)

Britain is facing a prolonged period of weaker economic growth as the plunge in the value of the pound pushes up prices for consumers, an influential think-tank has warned. The EY ITEM Club said the economy had been more resilient than expected following the vote to leave the European Union but this picture was deceptive (Sky News). Although the EY Item Club think tank predicts the economy will grow 1.9% this year, it expects that performance to fizzle out as inflation rises. (The BBC)

Tesco workers are taking legal action against their employer on grounds of age and gender discrimination after the supermarket cut its pay rates for night and weekend shifts. A group of 17 long-serving employees, who joined Tesco before 1999, are fighting the cut in wages introduced in July this year (The Guardian). Leigh Day, the law firm acting for the workers, estimated thousands of long-term Tesco staff, mainly in their 40s, could be affected. Tesco said workers would receive a “transition payment” for the changes. (The BBC)

The American owner of Cadbury paid no corporation tax on its main UK business last year, despite making a profit of £177m. Mondelez UK legally avoided the tax bill thanks to a £42m non-cash accounting gain from the sales of its coffee business, which was exempt from tax, and because it could offset other tax liabilities against interest payments. (The Times £)

Highland Spring, the Scottish bottled water brand owned by the billionaire businessman Mahdi al-Tajir, has hit record turnover and profits on the back of a surge in thirst for bottled water. (The Telegraph)

The entrepreneurs behind Mochi puddings, balls of Japanese rice filled with ice cream, have sealed a national listing with Ocado in a bid to challenge dessert giants such as Haagen-Dasz and Ben and Jerry’s. Little Moons, a British firm which makes 12,000 of the sticky rice balls a day from its North London production hub, said the deal would boost annual turnover by 40% to £4.2m. (The Telegraph)

The Brexit vote has brought uncertainty for the UK’s fruit pickers and farmers, writes The Guardian. Eastern Europeans who work seasonally at UK farms fear for their livelihoods, while their employers fear a labour shortage.

A leading farmer has warned that British vegetables will disappear from supermarket shelves if post-Brexit immigration controls prevent thousands of Eastern Europeans from working in the UK. Guy Poskitt, who grows 80,000 tons of carrots and parsnips a year in Yorkshire, says it is impossible to find enough British labourers to do the work. (Sky News)

The price paid by UK importers for prawns reached a record high. The increase of 15% in the past three months, reported by UK purchasing company Beacon, is because of a number of factors, including rising demand, droughts in Bangladesh and Vietnam, and poor harvests in China, which have left European importers’ prawn stocks running low. (The Guardian)

Philip Jansen, the boss of card payments giant Worldpay, is set to cash in on a surge in the company’s share price by selling £10m of his stock. Jansen, 49, has amassed a paper fortune of £70m since Worldpay — a former Royal Bank of Scotland subsidiary — joined the FTSE 100 a year ago. A lock-up period preventing management from selling shares expired late last week. (The Times £)

Sir Philip Green has hired a human rights lawyer to clear his name after he was branded the “the unacceptable face of capitalism”. He is said to have engaged Lord Pannick, QC, to salvage his reputation after the collapse of BHS in April with a huge deficit in its pension fund. (The Times £)

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