Breakfast is going to be costing us a lot more in the coming months. General Mills just announced to customers that they’re raising prices in January of next year on dozens of brands. Those brands include Annie’s, Progresso, Yoplait, Fruit Roll-Ups, Betty Crocker, Pillsbury, Cheerios, Cinnamon Toast Crunch, Lucky Charms, Wheaties, Reese’s Puffs, Trix, and more, according to letters General Mills sent to wholesale suppliers.
Many Companies Are Raising Prices
For some items, those pieces might be going up as much as 20%. An anonymous wholesale supplier told CNN that they intend to pass those price hikes down to the grocery stores that purchase from them. In turn, they expect the grocery stores to push the higher prices off on customers.
Not all companies are planning on pushing the higher prices off on their customers. Walmart, the largest grocery supplier in the United States, said its price gaps with competitors are wider than they were before the pandemic because the company is absorbing some costs instead of passing them on. Walmart made up 29% of General Mills’ sales last year.
General Mills’ plans are only the latest in a long list of food companies that have raised their prices. Tyson, Kraft Heinz, and Procter & Gamble are among some of the biggest names who have made their goods more expensive.
Overall, grocery prices have increased during the pandemic, going up 1% from September to October, and were 5.4% higher than they were at the same time last year. IRI, a market research firm, has projected that inflation on food, beverages, and household basics will climb to 8% during the first half of 2022 before settling at 4% in the second half.
America’s Inflation Issue
This inflation is due to many factors put in place by the pandemic. Food manufacturers and grocery stores have faced higher prices for commodities, labor, transportation, and other expenses during the COVID-19 pandemic. The price raising on goods is an effort to minimize the impact of the companies’ own spending.
In their letter, General Mills said that they were responding to these price hikes for material and labor: “The current operating environment is as dynamic as we’ve experienced in at least a decade, resulting in significant input cost inflation, labor shortages, and challenges servicing the business.”
Inflation has been a major issue for the American public, and President Biden is working with many retailers to try and help them ramp up production before the holiday season. In a speech on the issue, Biden said, “Today I’m announcing that the largest-ever release from the U.S. Strategic Petroleum Reserve as we recover from this pandemic. Our combined actions will not solve the problem….overnight, but it will make a difference.”