From Reuters, February 16:
Kraft Heinz Co and Conagra Brands Inc said they may choose to raise prices this year on some products that use wheat, sugar and other commodities that are becoming increasingly expensive due to high demand.
Conagra CEO Sean Connolly said the company, which makes Duncan Hines cake mixes and Marie Callender’s pulled pork mac and cheese bowls, will need to implement inflation-justified price increases this year so it can also continue to fuel sales growth through innovation.
Ingredient and packaging costs represent 60% to 65% of Conagra’s total cost basket, Finance Chief Dave Marberger said on the sidelines of the Consumer Analyst Group of New York virtual conference.
With people on lockdown cooking more at home – and still stockpiling in some parts of the world – prices for commodities like sugar, wheat and soy are surging, forcing food companies to absorb higher costs.
U.S. consumers on average paid 3.7% more for food consumed at home in January than they did a year earlier, according to the Bureau of Labor Statistics Consumer Price Index. Year-over-year increases in food prices have topped 3.5% each month since last April, the longest such stretch in nearly a decade....
....MUCH MORE
As farmers head into the planting season bear in mind we haven't even seen the effects of the YoY doubling of oil prices (technically the infinite move from negative futures prices but whatevs) feed into food prices. It takes a lot of gasoline or diesel to run those big tractors and combines, and then deliver the commodities to the processors, and then get your goodies to you.
If interested see also:
"Why Albert Edwards Is Starting To Panic About Soaring Food Prices"
St. Louis Fed: Food Prices As An Indicator Of Future Inflation
