Due to Inflation... US Food Companies Announce Successive Price Increases

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] According to the Wall Street Journal (WSJ) on the 11th (local time), Kraft Heinz, Tyson, McDonald's, and other major U.S. food suppliers and restaurants have announced price increase policies due to rising costs amid the worst inflation in 40 years.

According to the report, Kraft Heinz notified its distribution clients on the 6th that it would raise prices on several products, from Miracle Whip and Classico pasta sauce to Maxwell House coffee, starting in August. Kraft Heinz has raised product prices by 13.9% since 2019 but has determined that additional increases are necessary.

Kory O'Neill, Chief Sales Officer (CSO) of Kraft Heinz, who announced the price increase plan, stated that inflation is ongoing, affecting the economy and changing consumer patterns, and that costs are continuously rising. Kraft Heinz executives unanimously reported that they are struggling with soaring costs in labor, packaging, materials, and transportation.

Grocery distributors and restaurants also plan to pass these wholesale price increases on to consumers. Ian Borden, McDonald's International Sales Representative, said on the 9th that they are studying price increases within a range that does not overly impact consumers. He said, "We have an approach of increasing prices more frequently but in smaller increments."

Campbell Soup notified distributors in April that it would soon implement its third price increase in the past year, and earlier this month, major confectionery company Mondel?z announced that many more price increases would follow over the next year.

Food raw material suppliers are no different. Tyson Foods, the largest meat processor in the U.S., raised beef prices by an average of 24% over three months until early April, and Sanderson Farms, the third-largest chicken producer in the U.S., increased product prices by 34% by the end of April. Hormel Foods, well known for Spam, raised prices of livestock feed corn and soybeans by more than 125% and 40%, respectively, in early last month.

This content was produced with the assistance of AI translation services.