Coles boss Steve Cain has revealed that supermarkets are being forced to raise prices as food retailers struggle with rising production costs.
Over the past 12 months, Mr Cain has witnessed a dramatic increase in suppliers knocking on his door to discuss prices.
‘As I sit here today, we have received five times as many requests for price increases as we did last year. Five times, ‘Mr Cain said, speaking at the Australian International Food Forum on Wednesday.
‘And not a small amount. Not 2 percent or 3 percent asked so there are, you know, “pigs in the python” trying to work through the system, whether flat things or slowing down remains to be seen. . ‘
Mr Cain’s comments highlight the complex nature of the supermarket industry’s balance between maintaining the economic sustainability of suppliers, providing affordable food to consumers and maintaining a level of profit for shareholders.
But while the Russia-Ukraine War and the Covid epidemic block international supply chains and crops remain scarce due to the NSW-Queensland floods, food producers face increasing fees.
Buyers have been plagued by rising prices in supermarket purchases amid rising inflation
Woolworths boss Brad Banducci earlier this year also revealed that the company had already seen a 2 to 3 percent price increase, with more supplier fees expected soon.
As crop prices become increasingly dry and packaged, Mr Cain predicts budget-conscious buyers will be forced to live on cheap canned or frozen foods.
He also predicted that the Aussies would stop eating out at restaurants for home cooking, and sales of long-term food items would increase.
While floods in northern NSW and southern Queensland have devastated many vegetable and fruit farms, Mr Cain said lettuce and truss tomatoes are hard to find.
On the contrary, he said bananas and grapes are plentiful and prices lower than last year.
Mr Cain said his industry was also struggling with staff shortages as workers were taking on more pay elsewhere with Covid-19 and the flu staff list, with Coles workers taking twice the normal holiday rate.
However, he said the labor dispute is not related to high prices at the moment, but the effects will go ‘in the system’ and manifest ‘over the next 12 months’.
Coles CEO Steve Cain (pictured) said supermarkets are going to have to rise in price while retailers are demanding additional costs.
However, Mr Cain said there was good news for consumers, and prices in the soft and frozen meat industry for food stocks were running out during the epidemic.
The stern warning comes after a national summit for food and vegetable manufacturers announced the cost had risen by 700 percent since the disaster, which would have been passed on to consumers.
“Now it has come to a point where the current cost level is just astronomical and businesses can no longer control it and are in talks with retailers to pass some of that,” said the head of the Australian Food and Food Council. Executive Tanya Barden said.
On Wednesday, Treasurer Jim Chalmers warned inflation was expected to rise in the coming months, with the Central Bank of Australia expected to raise five more interest rates before the end of 2022 in a bid to cut prices.
Mr Cain predicts buyers will choose frozen and canned foods as food prices rise
The March quarterly national figures showed the economy grew by 0.8 percent, a sharp decline from the 3.6 percent corrective increase in the December quarter when the Delta-type locks ended.
The cost of living assistance that goes beyond current measures will be launched in the first Labor budget in October.
Oil tariff cuts, tariff cuts and welfare increases revealed in the union’s final budget in March should all be completed in the coming months.
Mr Chalmers says the new government is in the public eye about the cost of living, while continuing discussions with ministers and the energy sector on how to tackle rising energy costs.
“Our job as a new government, and my job in the October budget, will be to reduce the cost of living that includes areas such as child care, as well as affordable medicines, as well as our efforts to reduce electricity bills,” he told her. Nine Network on Thursday.
Mr Chalmers says it would be difficult to raise billions of dollars to continue reducing oil tariffs, and would not be willing to pull the government’s gas spell – to create an Australian Domestic Gas Storage System – to secure domestic supply.
German discount Aldi estimates that the average family spends $ 192.19 a week or $ 9,994 a year on groceries.
“I do not want to dismiss these types of debates in advance,” he said of the decision to use the system.
“It has its challenges and not immediately. There are a series of processes that we would need to go through.
“We need to be at the forefront and realize that there is nothing we can do to address this immediately.”
The stimulus could irritate Australian gas-dependent partners, as prices in the international market rise due to reliance on Russian supplies, with many long-term contracts being shut down at affordable prices.
“That is one of the challenges that the government and others will face if we follow that path,” Mr Chalmers told Sky News.
‘I do not recommend … we will follow that path. I say that is part of the debate and the debate that needs to happen now. ‘
With millions of Aussie families at least $ 670 a month getting worse in just six months – after a high level of acceptance, Australia’s economic outlook is bleak.
By Stephen Johnson, Daily Mail Australia economist
The average Australian family is expected to be worse than $ 670 a month by Christmas as interest rates and vegetable prices rise in line with the doubling of petrol tariffs and electricity bills.
How YOUR bill in December would be compared to now
MERCY: A borrower with a mortgage of $ 600,000 will see their monthly payment rise to $ 460 to $ 2,844 with interest rates five times higher
PETROL: Double tax on fuel tariffs up to 44.2 cents per liter could cause Toyota RAV4 billing bills to rise to $ 48.60 per month
UMEME: Double the increase in electricity bills means $ 118.67 more per month with the increase in electricity costs being passed to consumers.
DEBT EQUIPMENT: A family shopping in Aldi would see their monthly vegetable bill rise to $ 42.47 if inflation remained at 5.1 percent
New Treasurer Jim Chalmers warns of ‘rising inflation’ as Central Bank of Australia is widely expected to raise five more interest rates before the end of 2022 in an attempt to put the brakes on inflation.
“This positive storm of rising energy prices is causing tremendous damage to our employers, our households, and our nation’s economy,” he said.
The incoming government of Labor wants the lowest paid Australian workers to be given a 5.1 percent pay rise according to the consumer price index.
This could result in 2.7 million low-income and award-winning workers receiving the highest wage increase since 2006 at the peak of mining growth.
However adding additional staff costs to businesses that are still blocked by Covid locks you will no doubt find that the fraud is passed on to end users, pushing the prices of goods and services to be higher.
Mortgage borrowers with an average of $ 600,000 in mortgages last month saw their mortgage repayments rise to $ 78 after the RBA increased its interest rate for the first time since November 2010.
This average borrower would now owe his bank $ 2,384 a month, at a rate of 2.54 percent.
But if interest rates rise five times over Christmas – which is highly recommended by economists – the rate would rise to $ 460 to $ 2,844 with fluctuating rates rising to 3.94 percent.
Westpac, Australia’s second-largest bank, expects the RBA to raise rates five times more this year, starting with a sharp 0.4 percent increase in June.
New Treasurer Jim Chalmers warns of ‘rising inflation’ as Australian Savings Bank is widely expected to add five more before the end of 2022.
The bank’s chief economist Bill Evans expects a 0.25 percent increase in July, August, October and November.
The Australian economy grew by 3.3 percent in the year to March, with official national account data showing a 0.8 percent increase over three months.
“In view of the Savings Bank, these accounts will strengthen the case to raise interest rates,” Mr Evans said.
“The bank may see encouraging evidence in the account of wage growth but will focus more on the obvious inflationary pressures that are currently flowing in the economy.
‘The pressure of inflation was reflected in the price action.’
Last month, the RBA raised its inflation rate by 0.25 percent, from a record low of 0.1 percent, to 0.35 percent with all major banks fully approving the increase.
What you may be paying for by Christmas
$ 500,000: Monthly payments rise to $ 383 from $ 1,987 to $ 2,370
$ 600,000: Monthly payments rise to $ 460 from $ 2,384 to $ 2,844
$ 700,000: Monthly payments have gone up by $ 537 from $ 2,781 to $ 3,318
$ 800,000: Monthly payout rising to $ 614 from $ 3,178 to $ 3,792
$ 900,000: Monthly payments have gone up by $ 691 from $ 3,575 to $ 4,266
$ 1,000,000: Monthly payments have gone up by $ 767 from $ 3,973 to $ 4,740
Statistics according to the exchange rate rise from 2.54 percent to 3.94 percent while the Central Bank of Australia raises the exchange rate from 0.35 percent to 1.75 percent.