Food suppliers, restaurant chains say prices will keep rising

WHAT YOU NEED TO KNOW:

• Food suppliers and restaurant chains warned that food prices will keep climbing as inflation in the US rose unexpectedly last month.
• The Kraft Heinz Company, Tyson Foods and Campbell Soup all announced price increases on certain products.
• Fast-food chains like McDonald’s, Cracker Barrel, and Shake Shack have also warned about raising their prices.

Some food suppliers and restaurant chains warned that food prices in the U.S will keep climbing as inflation continues to impact the nation’s economy.

The Wall Street Journal reported that Kraft Heinz Company, Tyson Foods and Campbell Soup all announced they would increase prices on some products due to rising costs for ingredients, labor, packaging, and transportation.

Fast-food chains like McDonald’s, Shake Shack and Cracker Barrel have also announced price increase for some items.

“Inflation is real, and it’s not going to get any better any time soon in the restaurant business,” Randy Garutti, CEO for Shake Shack, said at an investor conference on Tuesday.

On Friday, the Labor Department said that prices of goods at grocery stores had increased 11.9% in May over the last years. Those at restaurants and other food businesses saw a spike of $7.4%. Both mark the biggest increase in more than forty years.

Kraft will be increasing prices for multiple items, including Miracle Whip, Classico pasta sauce, Maxwell Coffee and some deli meat in August

In April, Campbell Soup announced increase in prices for the third time in the past year, CEO Mark Clouse said, according to the Journal report.

Tyson Foods also had increased beef prices by an average of 24% over the three months ending April 2. Last month, chicken producer Sanderson Farms saidthe cost of its products jumped 34% for the quarter that ended April 30.

Hormel Foods, the maker of Spam, said prices for corn and soybean meal for livestock feed surged as of early May. Price increases are expected to continue, partly due to cold and wet weather in the Midwest this spring.

More people now choose cheaper brands as a result or opt to eat out less often.

The average American family now sees a monthly increase of $460 in expenditures as surging prices for food and fuel put budgets under strain, according to an analysis from Moody’s Analytics senior economist Ryan Sweet. 

Source: New York Post