Breakfast Cereal Is About to Get More Expensive
Pretty much everything is getting more expensive. The fallout from the COVID-19 pandemic, particularly its disruptions to the transportation and labor markets, has driven up most industries' underlying costs resulting in a spike in inflation. Snacks? More expensive. Turkeys? More expensive. Even slices of $1 pizza no longer cost a dollar. (You'd think they could just cut the slices thinner, but I guess this is why I don't own a $1 pizza joint.)
Plenty of packaged good brands have already spoken about their price hikes, names like Unilever, Mondelez, and Conagra. And yesterday, CNN Business offered up the latest details surrounding one of America's kings of cereal: General Mills.
According to the report, General Mills plans to increase its pricing in mid-January on hundreds of products across dozens of brands that include household names like Cheerios, Cinnamon Toast Crunch, Lucky Charms, Wheaties, Reese's Puffs, Trix, Annie's, Progresso, Yoplait, Fruit Roll-Ups, Betty Crocker, Pillsbury, and more. CNN cites a "major regional wholesale supplier" which asked to remain anonymous as to not spoil their business relationship with General Mills. CNN also says that a General Mills spokesperson did not provide a comment for their story.
The source suggests that General Mills' pricing for some items could increase as much as 20 percent. That number is on the high side, but not unheard of: Earlier this month, CNN reported that Kraft Heinz would be increasing the price on one of their Mac & Cheese products by 20 percent. However, in general, it's unlikely most products will see price hikes that severe.
From there, the question emerges: How much of these increases will come out of shoppers' wallets? The cost could be absorbed at a number of points along the supply chain. The wholesaler could eat some of the cost to help out retailers or retailers could eat some of the cost to try to appease shoppers. But CNN's anonymous source said don't expect any of that: They're planning to pass the price increase onto stores which they assume will end up on customers' laps.
The moral: Expect to be paying more at the grocery store regardless of your brand of choice.