Tesco takes on Unilever in major Brexit pricing stand-off

The row given extra spice by the fact Tesco’s chief executive spent nearly three decades at Unilever himself...

There's a shortage of Pot Noodle and Marmite on Tesco shelves across the UK today, as the supermarket chain locks horns with Unilever over pricing.

Unilever, the global manufacturer of a range of consumer goods including Dove soap, PG Tips tea and Ben & Jerry’s ice cream has demanded a price rise of up to 10% from Tesco, blaming the falling value of sterling on its profit margins.

The pound has fallen 17% since June's vote for Britain to leave the European Union.

When Tesco, one of Ireland and the UK's leading supermarket chains, refused to budge, Unilever stopped delivering to stores. Now Tesco has begun delisting them from its website.

Many of these products are showing as being unavailable on Tesco's website, but the supermarket says it will still continue to sell existing supplies in its stores until they run out. 

A spokesperson for Tesco said: "We are currently experiencing availability issues on a number of Unilever products. We hope to have this issue resolved soon."

Tesco's chief executive, Dave Lewis, spent much of his career working at Unilever before jumping ship to join the supermarket two years ago.

Other UK supermarket chains are also believed to be embroiled in the row with Unilever, which generated profits of about £2bn in the first half of this year.

Unilever has refused to comment, but in advance of June's referendum, chief executive Paul Polman did warn a Brexit vote would cause price rises.

While there was no mention of the dispute in its third quarter trading update on Thursday, Polman did express his satisfaction with Unilever's performance.

"Our business continues to demonstrate its resilience by growing competitively and consistently in tough market conditions," he said.

Unilever said while group underlying sales grew 3.2% in the three months to the end of September, sales at current currency rates fell by 0.1% reflecting a negative foreign currency hit.

Its share price was 1.4% down when markets opened for business on Thursday. Tesco's fell 1.8%. 

Additional reporting by IRN