Many food manufacturers say they plan to raise prices in 2022 for a range of products from macaroni and cheese to snacks, the latest sign that consumers will continue to face higher costs at the supermarket.

“There is nothing immune to price increases,” said Tony Sarsam, CEO of food retailer and distributor SpartanNash Co., adding that dairy products, dairy products and packaged foods such as bread and fruit juices are among the many items that are expected to get more expensive over the next year.

Food prices are expected to rise 5% in the first half of 2022, according to research firm IRI, although the level of the increase varies by grocer and region.

Mondelez International Inc. recently said it was increasing the prices of cookies, candies and other products sold in the United States from 6% to 7% starting in January. General Mills Inc. and Campbell Soup Co. have said their price increases will also take effect in January. Kraft Heinz Co. has told its retail customers it will increase the prices of several of its products, including Jell-O Pudding and Gray Poupon mustard, with some items up to 20%, according to a note viewed by the Wall Street Journal.

The increases follow others that food manufacturers imposed in 2021 and are part of what businesses and economists have called the highest inflation in decades. Rising wages, materials and transportation costs are prompting industries, from manufacturing to retail, to raise the prices of goods, creating an environment in which some executives say they have the option of charging more.

Kraft Heinz said the average price increase for its products will be 5%, adding that it is not passing all of its cost increases on to its customers. Gray Poupon’s production costs are up 22%, and the company is increasing them from 6% to 13% for customers, the company said.

Mondelez, General Mills and Campbell made no further comment.

The Labor Department said the consumer price index rose 6.8% in November from a year ago, the fastest pace since 1982. The home food index, which includes purchases in grocery stores, rose 6.4% over the past 12 months, with meats, poultry, fish and eggs up 12.8%.

The coming price increases in 2022 range from just 2% to 20%, affecting all sections of the grocery store, including produce and packaged goods. Potatoes, celery and other heavier vegetables will have higher prices next year in part because of higher transportation costs, supermarket executives said. Wine, beer and spirits are also likely to become more expensive, they said, especially those imported.

Pantry staples such as mayonnaise and frozen meals are expected to be more expensive in part due to higher labor, logistics and packaging costs, some executives said.

Consumers remain willing to spend on groceries even as prices rise, some companies say, even as that starts to change. As buyers become more price sensitive, they are buying cheaper versions of meat and cooking oil, among others, industry executives have said. Supermarkets say they are taking a variety of approaches to tackle price increases as consumers respond to prices, including cutting off certain items.

SpartanNash, based in Grand Rapids, Mich., Maintains prices for frequently purchased items such as milk, eggs and frozen waffles, Sarsam said. Consumers are more careful about what they pay for such items. To make up for what it loses on those staples, he said, the Martin’s Super Markets and Family Fare store chain charges more for baked or prepared foods such as stuffed chicken breasts. So far, consumers are showing that they are willing to pay more for certain foods that can save them time.

The rapid pace and wide range of increases are becoming increasingly difficult for supermarket operators to understand. Reynolds Cramer, CEO of Fareway Stores Inc., said: “We received a letter from a supplier announcing price increases next month. We haven’t implemented the price increases they gave us this month. “

Stuart Aitken, chief trader and marketing director of Kroger Co., said the grocer was pushing back some suppliers, delaying the entry into force of price increases and asking manufacturers about the rate of increase to ensure that proposed price increases are correct. “Accepting price increases is never a good result,” said Aitken.

Other grocers are stockpiling merchandise before prices rise again, some securing truckloads of items at a hefty discount shortly before their expiration date.

Grocery delivery company Fresh Direct LLC expects costs to increase by 2% to 4% in 2022 and plans to pass on increases for more specialized or less popular items to its customers and monitors competitor prices each. week, said Scott Crawford, its chief merchandising officer. officer.

“I hope it’s transient, but once the bar is set it will go up,” Crawford said.

Susie Scott, a retiree who lives in Collierville, Tennessee, said she noticed her grocery bill has gone up in recent months. Bacon and milk are among the increasingly expensive items, Ms Scott said, adding that she pays more attention to prices when shopping. She buys chicken and chopped chuck on sale every Tuesday at her nearby supermarket, but even they get expensive.

“I spend more on groceries, and it’s not necessarily that I’m buying more,” Ms. Scott said.

This story was posted from a feed with no text editing

To subscribe to Mint newsletters

* Enter a valid email address

* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our app now !!

About The Author

Related Posts