Food products: we explain why prices are soaring

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Pasta, coffee, mustard, flour… For several months, consumers have been witnessing a rise in food prices, which even seems to be accelerating. Explanations.

Why are prices soaring?

The inflationary context that has weighed on food products for several months is mainly linked to the end of the global pandemic crisis. “This has tended to push up both the prices of raw materials (coffee, wheat, etc.), and at the same time all the related costs, i.e. those surrounding the products (the transport, products, packaging…)”, explains Rodolphe Bonnasse, retail expert.

Added to this, on raw materials, are multifactorial causes. The increase in the price of dried fruits, for example, is thus particularly linked to bad weather. “Frost damaged crops last year, impacting yields.” The price of avocados has risen sharply due to an increase in demand. “Its consumption has exploded in westernized countries because it has become a very trendy product”. Another example, the rise in the price of pasta and semolina is explained by the fact that Canada, the leading producer of durum wheat, suffered last year from poor harvests.

Which products are most affected?

Today, the first food item affected by inflation is pasta, with a 14% increase since March last year. “This is explained by the rise in the price of wheat, as well as that of packaging. The price of paper pulp which is used to make cardboard has risen sharply”, specifies the expert. Then comes mustard, up 8%, due to tensions around sunflower oil. The oil also undergoes an increase of 7.4%.

Other products affected: flour, +7%, due to the problem of the availability of common wheat. And dried fruits, +6.7%, due to poor harvests last year.

Should we fear shortages?

“Currently, there are no shortages of production,” reassures Rodolphe Bonnasse straight away. “However, there are shortages of anticipation.” It is indeed the behavior of the consumer that can lead to a shortage of facade. “Shelf shortages are rather the consequence of consumer fear. They will tend to buy one more product than they had planned, thus causing short shortages during restocking,” says Olivier Dauvert, also an expert in large distribution.

“Nevertheless, tensions are mounting on flour, sunflower oil, and poultry because of avian flu. If ever the system were to jam, shortages could occur within 3 to 4 months.” says Olivier Bonnasse.

Will inflation continue?

According to the specialist, inflation on food products should continue. The crisis in Ukraine has indeed had the first consequence of causing tensions on energy prices, which is a component of the price of the product. “Energy is everywhere, in transport, manufacturing, freezing…”. Second reason, the current prices are offered on the Ukrainian harvests of last year, not yet heckled by the geopolitical context. “Ukraine is doing everything to continue to sow its wheat and maize, but it seems extremely complicated, just like for the delivery of the products”.

“Three quarters of the world’s sunflower production being Russian-Ukrainian, there could be very strong tensions if the crisis ever continues”, assures the expert. The country is also a major producer of wheat for animal feed. “It’s a safe bet that the cereals that feed calves, cows, pigs will increase. Farmers should therefore sell their products at a higher price”. Ukraine is also a major producer of fertilizers and a major exporter of chickens to Western countries.

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