September Fears... Price Increase Tsunami in the Food Industry

[Asia Economy Reporter Eunmo Koo] Recently, as food companies have been raising product prices one after another, price hike measures are continuously being announced even after September, increasing the burden of grocery prices on consumers.

According to the food industry on the 27th, Nongshim has decided to raise the prices of 26 ramen products, including Shin Ramyun, by an average of 11.3% starting from the 15th of next month. The price increase rates for major products based on the shipment price are 10.9% for Shin Ramyun, 9.9% for Neoguri, and 13.8% for Chapagetti. Nongshim is known to have pulled out the price increase card as its domestic operating profit recorded a deficit for the first time in 24 years, worsening its business situation.

As Nongshim fired the starting signal for price hikes, the decisions of food companies to raise prices seem to be spreading rapidly. First, processed meat products such as chicken breast will see price increases starting in September. Harim will raise the price of chicken breast (Garlic and Black Pepper 110g) sold at convenience stores from 3,400 won to 3,700 won next month, an increase of 300 won. Chicken breast sausage will increase from 2,300 won to 2,500 won, up 200 won. This corresponds to increases of 8.8% and 8.7%, respectively. Sajo also plans to raise the price of chicken breast products sold at convenience stores by 12.1% starting next month.

Ready meals containing special chicken parts will also be raised. Daesang will increase the price of its boneless chicken feet ready meal 'Anjuya' (160g) from 8,900 won to 9,500 won at convenience stores, a 6.7% increase, and Daesang’s representative seasoning product 'Miwon' (100g) will also be raised from 2,400 won to 2,700 won, a 12.5% increase.

Dairy products will also start price hikes next month. Binggrae’s distributed French cheese brand 'Belcube Plain' (78g) and 'Wrapping Cow 8 Portion Plain' will increase from 6,000 won to 6,900 won, a 15% increase, and Dongwon’s cheddar cheese (5 slices) will be sold at 2,400 won, up 20% from 2,000 won.

Soy milk is no exception. Jeongsik Food will raise the recommended retail prices of major products such as Vegemil A by an average of 11.7% (minimum 3.3% to maximum 26.3%) starting from the 15th of next month. By product, the price of Vegemil A bottle and Vegemil Sweet bottle 190ml will increase 14% from 1,400 won to 1,600 won, and Vegemil Black Bean bottle 190ml will rise 20% from 1,500 won to 1,800 won. The price of Thick Soybean Milk 950ml will increase 8.8% from 3,400 won to 3,700 won.

Voices say that the price hikes in the food industry were already anticipated as international grain prices, which peaked in the second quarter, were reflected in the import prices in the third quarter. The industry also states that due to the prolonged Russia-Ukraine conflict and inflation, raw material prices have surged and exchange rates have risen, intensifying cost burdens.

An industry official explained, “It is not only the cost of specific raw and subsidiary materials that has risen, but also labor costs, transportation costs, and other overall manufacturing process costs have increased, leaving almost no room to shift cost burdens to other areas,” adding, “As crisis responses such as utilizing stockpiled inventory or diversifying supply sources have reached their limits, price increases are inevitable in reality.”

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