UK retail giant disputes post-Brexit price hike

LONDON (AA) – Pound sterling’s dramatic fall in value after Brexit caused the U.K.’s largest supermarket on Thursday to withdraw food products in a pricing dispute.

Retail giant Tesco said it temporarily stopped selling certain items by Unilever, one of the largest consumer goods makers in the world, after it demanded a 10 percent price rise because its production costs had increased.

Pound sterling has lost 16 percent of its value against the euro and 18 percent against the U.S. dollar since people in Britain voted by a 52-48 percent margin to leave the European Union on June 23.

The slide has made imports to Britain more expensive, raising fears higher costs will be passed on to consumers.

Tesco said in a statement: “We are currently experiencing availability issues on a number of Unilever products. We hope to have this issue resolved soon.”

Unilever, which produces internationally recognized brands including Dove, Magnum and Persil, has not commented.

The dispute came two days after the Food and Drink Federation (FDF), a trade association, warned the U.K. food industry was becoming increasingly fragile.

An FDF survey published Tuesday warned ingredient prices were rising and profit margins falling as a result of Brexit, despite retailers reporting increased sales over the summer.