With no end in sight regarding supply chain disruptions and inflation on the rise, consumers should brace themselves to expect higher food prices for everyday staples starting in 2022, from coffee to mustard and from Oreos to Jell-O.
Indeed, The Wall Street Journal reports that food prices are estimated to rise 5% in the first half of 2022, according to research firm IRI, though the level of increase will vary from store to store and from region to region.
These numbers reflect the Consumer Price Index (CPI) figures, as the all-items CPI — a measure of economy-wide inflation — was up 6.8% from November 2020. Additionally, food prices were 6.1% higher than in November 2020, according to the Labor Department.
The level of food price inflation varies depending on where the food was purchased: the food-away-from-home (restaurant purchases) CPI increased 0.6% in November 2021 and was 5.8% higher than November 2020. By contrast, the food-at-home (grocery store or supermarket food purchases) CPI increased 0.3% from October 2021 to November 2021 and was 6.4% higher than November 2020.
Vegetables, Snacks, Beer and Wine Will Be More Expensive in 2022
Anticipated price increases in 2022 range from 2% to 20%, hitting all sections of the grocery store — including produce and packaged goods, according to the WSJ. Vegetables with the highest predicted price tag bumps include potatoes, celery and other heavier vegetables — in part because of higher freight costs, supermarket executives say — per the WSJ. In addition, wine, beer and liquor are also likely to get more expensive, especially those that are imported.
The WSJ adds that pantry staples such as mayonnaise and frozen meals are expected to be pricier partly because of higher labor, logistics and packaging costs, according to industry insiders.
Mondelez International, whose brands include Chips Ahoy, Ritz Crackers, Oreo and Philadelphia cream cheese, said recently that it would be raising prices for certain products by 6% to 7% starting in January, according to a Motley Fool transcript of an investor call.
“We have also taken and announced price increases across a significant number of markets. Of note, we announced a new round of pricing last month in the U.S. which will go into effect at the start of next year,” Luca Zaramella, chief financial officer, said on the call. “So we have announced that for Biscuit and on average that’s the number, we are going with gum and candy as well. Hall’s will be a little bit later in the cycle. But all in all it is going to be very close to the 6%, 7%.”
Other companies intending to hike their prices include Kraft Heinz — including products such as Jell-O pudding and Grey Poupon mustard — with some items going up as much as 20%, according to a memo viewed by the WSJ.
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