'Marmageddon' resolved as Marmite returns to UK shelves

The price dispute which saw Britain's famous Marmite spread pulled from supermarket shelves following the plunging pound has been resolved, Unilever announced on Thursday.

The nation's biggest retailer Tesco had halted sales of top Unilever brands on Wednesday including Marmite -- the yeast extract which is mostly eaten on toast and is known for the "love it or hate it" slogan.

The pound, which has slumped against the euro and dollar since Britain voted to leave the European Union on June 23, has placed food retailers in a squeeze between suppliers and consumers.

Jars of Marmite had been marked as "currently not available" in the online store of Tesco, the world's third biggest supermarket chain said after reportedly refusing Unilever's request to hike prices by 10 percent.

Other products, including Ben & Jerry's ice cream, Hellmann's mayonnaise, Magnum ice cream, PG Tips tea, Persil washing powder and Pot Noodle snacks, had also been marked as unavailable.

But fears of impending shortages were abated on Thursday with Unilever announcing the company had "successfully resolved" the supply situation with Tesco.

"We have been working together closely to reach this resolution and ensure our much-loved brands are once again fully available.

"For all those that missed us, thanks for all the love," Unilever said in a statement.

- British institution -

Ahead of the agreement the sudden absence of British institution Marmite had appeared to spark a national crisis, lighting up Twitter with hashtags #marmageddon and #marmitegate.

"Are you a Unilever or Uni-remainer?" tweeted Sophie Petzal, in reference to the Marmite debate -- and to the Leave and Remain sides of the Brexit referendum.

Britain's media seized on the news, with the BBC running a live report, while the Metro daily newspaper splashed with the headline "Marmite wars".

Industry experts predict that Brexit -- which like Marmite has polarised public opinion -- could spark further turmoil with more price hikes to come in the food sector.

"It is a concrete example of the primary impact of Brexit on consumers' pockets. This is just the beginning and more disputes over prices are likely to come in the coming months,? Euromonitor analyst Pinar Hosafci told AFP.

Politicians argued Unilever was using Brexit as an excuse to ramp up prices, while the move also raised eyebrows because Marmite's ingredients are sourced in Britain.

Conservative lawmaker Sir Gerald Howarth said it will be very damaging to Unilever's reputation "if they seek to use the fall in the pound to exploit the consumer".

The Dutch firm -- which backed the failed Remain campaign -- contends it has been hit by the pound's slump, which has tumbled to 31-year lows against the dollar and 7.5-year troughs versus the euro.

Releasing stagnant third-quarter figures Thursday, multinational Unilever acknowledged it was a "tough market" globally.

"But in the UK, which is about 5.0 percent of our global turnover, prices should start to increase to recover higher cost of imported materials from the weaker sterling," said chief financial officer Graeme Pitkethly.

- Rising costs -

Analysts said Tesco, whose chief executive Dave Lewis is a former Unilever executive, would be reluctant to hike prices as it battles fierce competition with German-owned discounters Aldi and Lidl -- and traditional supermarket rivals Asda, Morrisons and Sainsbury's.

"It needs to be seen how much of this is really Brexit -- or just suppliers using Brexit as an excuse to raise prices," added analyst Markus Huber at City of London Markets.

"Even if Tesco would agree to them, consumers might just shop even more in discounters like Lidl and Aldi. "

In London, Tesco's share price closed down 3.03 percent at 195.10 pence, while Unilever shares shed 3.11 percent to 39.47 euros in Amsterdam.