Consumers may now have to shell out more for daily use products. FMCG companies are preparing to increase the prices of their products due to the rise in prices of commodities like wheat, palm oil and packaging goods. Apart from this, FMCG companies have also suffered due to the Russia-Ukraine War. They believe that due to this, there will be a jump in the prices of wheat, edible oil and crude oil.
Companies like Dabur and Parle are watching the situation and will take careful steps to deal with inflationary pressures. Some media reports said that Hindustan Unilever and Nestle have increased the prices of their food products last week. Mayank Shah, Senior Category Head, Parle Products, told PTI, “We are expecting 10 to 15 per cent increase in prices by the industry.”
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He said that there is a lot of volatility in the prices. In such a situation, it is difficult to say so far how much the price increase will be. He told that the price of palm oil had gone up to Rs 180 a liter. Now it has come down to Rs 150 a litre. Similarly, after going to $140 per barrel, the price of crude oil has come down below $ 100.
“However, the prices are still higher than before,” Shah said. Shah said, “Now everyone is talking about 10-15 per cent growth. However, the cost of production has gone up significantly.” He said that Parle has enough stock at present. A decision on price hike will be taken in a month or two.
Echoing this view, Dabur India’s Chief Financial Officer Ankush Jain said that inflation continues to remain high and it is a cause for concern for the second year in a row. “Consumers have reduced their spending because of inflationary pressures. They are buying smaller packs. We are watching the situation and after due deliberation, we will take measures to avoid inflationary pressures.”
Edelweiss Financial Services Executive Vice President Abneesh Roy said FMCG companies are passing the burden of inflation on to consumers. “Hindustan Unilever and Nestle have the power to set the price high. They are passing on the burden of price hike of coffee and packaging goods to the customers. We estimate that all FMCG companies will increase prices by three to five percent in the first quarter of 2022-23. have been extended. These companies have passed some of the burden of the hike in commodity prices to the consumers.