Britain's grocery sales fall for first time since June 2016 -Kantar

       * Year-earlier sales boosted by heatwave
    * Sales fell at big four grocers
    * Inflation declines to 0.9%
    * Tesco (TSCDF), Sainsbury's (JSNSF) and Morrisons shares fall

 (Adds detail, shares, table)
    LONDON, July 23 (Reuters) - British grocery sales fell by
0.5% in the latest 12 week period in their first decline since
June 2016, industry data showed on Tuesday, sending shares
across the sector lower.
    Market researcher Kantar said the sales dip reflected a
heatwave a year earlier which had boosted demand.
    It expects the market to return to growth once the
comparative highs of the summer of 2018 pass.
    Sales fell year on year at all of Britain's big four
supermarket groups over the 12-week to July 14 period, Kantar
said.
    Sales at market leader Tesco (TSCDF) declined 2.0%, while
at Sainsbury's (JSNSF), Asda and Morrisons they
were down 2.3%, 2.0% and 2.6%, respectively.
    Shares in Tesco (TSCDF) were down 2.4% at 0813 GMT, Sainsbury's (JSNSF) was
down 1.2% and Morrisons was down 0.8%.
    All of the big four lost market share to German-owned
discounters Aldi and Lidl. Aldi's sales were up 6.7% and Lidl's
were up 7.0%.
    "It was a challenging 12 weeks for all the major grocers,
with growth slowing at every supermarket except Ocado (OCDGF),"
said Fraser McKevitt, head of retail and consumer insight at
Kantar.
    "Last year people shopped more frequently and closer to home
as they topped up the cupboards while enjoying the sunshine and
the men's football World Cup," he said
    "This year households are making one fewer trip, which may
not sound like much but is enough to tip the market into
decline."
    Kantar said consumers spent 75 million pounds ($93.3
million) less on alcohol this year compared to last. Soft drinks
sales fell by 56 million pounds and ice cream by 55 million
pounds.
    It noted that grocery inflation fell marginally to 0.9% in
the period. That is good news for consumers but makes it harder
for retailers to achieve growth.
    Kantar said prices are rising fastest in markets such as
crisps, canned fish and fruit squash, while falling in instant
coffee, detergents and fresh bacon.

  Market share and sales growth(%)
                  12 weeks to   12 weeks to   % change in
                  July 14,      July 15,      sales
                  2019          2018
 Tesco            27.2          27.6          -2.0
 Sainsbury's      15.3          15.6          -2.3
 Asda             14.9          15.1          -2.0
 Morrisons        10.3          10.5          -2.6
 Aldi             8.1           7.5           6.7
 Co-operative     6.4           6.4           0.2
 Lidl             5.8           5.4           7.0
 Waitrose         5.0           5.0           -1.9
 Iceland          2.1           2.1           -1.5
 Ocado            1.4           1.2           11.9
 Source: Kantar

($1 = 0.8037 pounds)

 (Reporting by James Davey; editing by Kate Holton and Jason
Neely)

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