And that has everything to do with the cost of raw materials, Geeroms says. For example, the price of oil was 43% higher in 2022 than in 2021 and electricity was even 145% more expensive than in 2021. expensive and metals were 23% more expensive. “And also not irrelevant: Labor costs in the retail sector have increased by five percent.”
“In 2022 alone, producers raised prices by 15%”
He points out that a major part of the cost increase has ended up on food retailers, who have passed most of the costs on to customers. “In 2022 alone, food manufacturers increased their prices by 15%, while retailers only increased their prices by 12%,” continues Geeroms. “And now retailers appear to be catching up, to recoup the lost 2022 margin.”
The whole year
And retailers probably need all year round to do that, thinks Geeroms. The margins that companies lost in 2022 are such that prices will continue to rise until the end of 2023. “Of course there is also a certain habituation effect,” she says. ‘Everyone is talking about inflation, but they are unaware of the underlying rise in food prices at source. The retail sector makes excellent use of it.’
According to Geeroms, this is what is known as grab inflation. Where food prices in the retail sector are expected to remain stable, or perhaps even decline, prices continue to rise. ‘Supermarkets are therefore partly busy with takeaway inflation, because commodity prices are falling. They are now catching up with an accelerating effect on the margin they lost last year.’
Look at the coffee grounds
Geeroms doesn’t yet dare to say what the situation will be like in 2024. “That’s looking at coffee grounds,” he concludes. ‘At the moment it’s impossible to say. Also because we don’t know how long the war will last. We have made an estimate until the end of the year, but if you ask me, I think prices will come down after that.’