UK grocery market growth plummets to 10-year low


Competitive price wars among the U.K.'s biggest supermarkets have driven down the cost of food, pushing the overall growth of the grocery market to a 10-year record low.

Deflation in staple items such as bread, milk and vegetables also contributed to the fall in growth, which came in at just 0.8 percent for the 12 weeks ending 17 August this year, according to data from Kantar Worldpanel.

Once again it was the budget and luxury grocers that delivered growth ahead of the market, while the mid-range stores remained under pressure.

Read MoreUK retail sales growth muted as food sales dip

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Aldi posted the strongest growth in terms of market share, claiming 4.8 percent compared to 3.7 percent over the same period last year. Asda and Waitrose also managed slight gains.

Tesco, still the U.K.'s dominant retailer with almost 29 percent market share saw its share fall from over 30 percent, when compared with figures from 2013.

Read MoreSupermarket wars hit UK retail sales

"Asda and Waitrose have achieved growth with differing strategies. Asda has pushed its "Price Lock" strategy to keep prices on everyday essential items low, while Waitrose is running competitive offers on home delivery alongside offers for myWaitrose card users allied to its overall quality and provenance positioning," director at Kantar Worldpanel, Edward Garner said.

"With the exception of Asda, the big four are feeling the squeeze as Tesco and Morrisons shares remain under pressure, while Sainsbury's has suffered a small drop in share from 16.5 percent to 16.4 percent as its sales growth lags behind the market at 0.3 percent," he said.

Meanwhile, grocery inflation has seen its eleventh successive fall and now stands at 0.2 for the period, a record low since Kantar Worldpanel starting recording it in October 2006.

By CNBC's Jenny Cosgrave: Follow her on Twitter @jenny_cosgrave