This month Conagra, which owns brands including Orville Redenbacher’s popcorn, Bird’s Eye frozen veg and Duncan Hines cake mixes, reported bumper results for its latest quarter. Sales and margins were all up year on year. The company expects higher earnings in the fiscal year to May than it had previously forecast. A few weeks earlier General Mills, which peddles canned soups, frozen vegetables and breakfast cereals, unveiled similarly juicy quarterly numbers.
As big food’s results show, the industry is managing to ride out the latest tumult. For one thing, the pandemic may have altered consumer habits, leading to a lasting bump in the consumption of frozen and packaged meals. Americans are still eating more meals at home than they were before the first covid-19 lockdowns. According to, a consultancy, nearly three in four consumers anyway do not carefully distinguish frozen vegetables from the fresh sort, treating them as the same category.
The food giants also benefit from a diverse range of products and brands, which they are adapting to changing consumer tastes. Conagra has introduced “crustless pizzas”—microwavable boxes of sauce, cheese and meat—to appeal to the carb-phobic. Its vegan Power Bowls seem tailor-made for the avocado-loving yoga crowd. General Mills is marketing cereal as an after-school snack and alternative to dessert in the evening, rather than just something to munch for breakfast.
Can the good times last? The biggest question-mark hangs over sales volumes, which could be crimped by those higher prices and a looming economic slowdown that may prompt shoppers to start pinching pennies. If wage growth slows or unemployment ticks up, at some point people will probably cut back even on smaller luxuries. Should one food firm decide to trim prices in an effort to boost volumes at its competitors’ expense, an old-fashioned price war may erupt.
Whoa
Really need more low sodium options out there. Cooking from scratch for myself all the time does get tiresome.
Because they raised their prices more than their costs!
All this is man made. Greed, politics etc
The fact that big food companies are still posting strong earnings despite rising inflation is concerning. We need to ensure that the burden of inflation is not disproportionately affecting vulnerable populations, including low-income families and individuals.
It’s the one thing everyone needs. Leftist don’t understand economics. Demand is the most important force in a market. By making energy expensive they inflate the cost of everything because transportation is energy dependent. A forced contraction with too much cash in service.
Because when times are hard, corporations ALWAYS find a way to make employees and consumers shoulder the burden. Making less money is NEVER an option even if someone else has to bleed to make up the difference.
Inelastic demand
Because it's not inflation, it's coordinated price gouging.
Yes it has. People are switching stores and switching brands. There's only a tail because there is too much store consolidation limiting options.
Don't look now, but, Consumers are already pinching Pennies...
Well the WuFlu injection cost will go up soon so we will have to cut back on food to afford that.
Big food needs to stop being so greedy - we all know they are just Trying to push the limits and test consumer spending right no
What good times?
Yes
Terrible news, terrible waste.
So sad
Fresh foods are actually cheaper
Kind of a captive market, we all gotta eat.
Processed food is gross and should not be consumed by anyone