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Food: Nestlé announces further price increases


Even if inflation is gradually weakening, Nestlé products are expected to become more expensive this year. In an interview, the head of the world's largest food manufacturer speaks of "catching up".

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Nestlé CEO Ulf Mark Schneider

Photo: Laurent Gillieron / KEYSTONE / picture alliance

Butter is becoming cheaper again, but overall food prices remain high in view of inflation - and could sometimes rise even further: The CEO of the Nestlé food company, Ulf Mark Schneider, believes further price increases for the company's products this year are unavoidable.

"We have not yet fully passed on the additional costs incurred for us," Schneider told the "Frankfurter Allgemeine Sonntagszeitung" ("FAS").

»There will therefore be further price increases.«

Nestlé is the largest food manufacturer in the world.

According to the report, the Swiss company raised prices for its range by an average of 7.5 percent in the first half of last year.

According to the Federal Statistical Office, food was 13.4 percent more expensive in 2022 than in 2021.

Schneider told the “FAS” that even if inflation is no longer as high as in 2022, there is “still a need to catch up for the year as a whole” for Nestlé.

The extent of the price increases depends on the development of labor and energy costs.

Schneider said that Nestlé was "not the cause of this inflation" and "affected by it like every consumer."

"I don't want to be accused of cheating"

In fact, many costs involved in the production of food, such as energy, have increased.

However, consumer advocates are calling for manufacturers and retailers to take a closer look at the price increases.

"Not all price increases are transparent and based on higher production costs," write the consumer advice centers.

They call on politicians and the cartel office to "check whether companies are using the situation to improve their own earnings".

In the first three quarters of the previous year, Nestlé sold 69.1 billion francs (70.4 billion euros) worldwide.

Under our own steam, i.e. excluding acquisitions and exchange rate effects, the increase in sales was 8.5 percent - this was also due to price increases.

The group will present annual figures for 2022 on February 16.

Schneider rejected allegations by consumer advocates and retailers that Nestlé was enriching itself at the expense of consumers.

Schneider also denied a question as to whether Nestlé wanted to hide price increases with smaller packaging sizes.

"I don't want to be accused of cheating," he said.

Consumers recently voted Upfield's "Rama" grease spread "Sham Pack of the Year" because of such a hidden price increase.

Nestlé wants to strengthen business with meat substitutes

Schneider also commented in the "FAS" on the future market opportunities for plant-based meat substitutes.

His company thus turns over "more than 800 million francs a year" - the equivalent of almost 800 million euros - "and with double-digit growth rates".

The importance of this business for the group will increase significantly in the coming years, said Schneider.

They should also help reduce greenhouse gas emissions.

As for the potential of lab meat, Schneider said it is inferior to plant-based products in terms of protein content and calorie count.

»That's why I think laboratory meat is particularly interesting for so-called hybrid products.

That means, for example, you make 80 percent of your food from plants, and as a final touch you mix in some cultured meat.”


Source: spiegel

All business articles on 2023-02-04

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