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OPN Connect Newsletter 280 · August 4, 2022

Inflation Escalated Organic and Conventional Retail Prices in Just Four Months


Has retail pricing gotten out of control by virtue of runaway inflation? Are premium products far less affordable right now? Will favorite produce categories start to feel some resistance from shoppers?

Higher-quality products that are normally priced at a premium are even more expensive now, having become caught in the inflation trap.

Global Organics Aug 2022

From March to July of this year, retail prices soared as inflation forced its hand upon produce. And while organic produce is normally higher priced, the category has not increased as much as conventional produce in this inflationary environment, according to our recent price checks.

We examined prices of the most popular produce items in major supermarket chains over the four months. The results show how inflation has flexed its muscles on food prices at a time when most consumers are being handicapped by increased living costs.

Prices have always been a sensitive subject for shoppers, and the past several months does not change that awareness. In fact, many of the increased prices have placed shoppers on alert as they can no longer bear to pay for items that exceed their budgets.

From March to July of this year, retail prices soared as inflation forced its hand upon produce. And while organic produce is normally higher priced, the category has not increased as much as conventional produce in this inflationary environment, according to our recent price checks.

Chelan Aug 2022

After calculating and evaluating our price checks, we certainly commiserate with those consumers struggling to make ends meet at home. The price increases clearly indicate a reason why shoppers may choose to bypass items as they browse the produce department.

The supermarket banners we checked are major competitors across the US that support both organic and conventional produce programs.

Popular category items were checked on July 14, 2022, and compared with the same items checked on March 11, 2022. Note: If a store had one of the organic items but did not have the conventional counterpart at the time of the check, it was not included in the total. Likewise, if a store had a conventional item but not its conventional counterpart, it was not counted.

Misionero Aug 2022

Here are some of the comparisons for our basket:

  • Organic price check total amount for March 2022: $153.68
  • Organic price check total amount for July 2022: $166.65
    • July organic produce prices increased by $12.97 or 8.4%

The supermarket banners we checked are major competitors across the US, and support both organic and conventional produce programs.

  • Conventional price check total amount for March 2022: $104.49
  • Conventional price check total amount for July 2022: $121.91
    • July conventional produce prices increased by $17.42 or 16.7%

This indicates that the conventional price increase was higher than that of organic, suggesting that organic prices may have reached their pricing peak. Shoppers simply refuse to pay for items they can no longer afford.

Cal-Organic Aug 2022

The price check also points out the difference between organic and conventional retails in March versus July.

In March 2022, organic produce was $49.19 or 47.2 percent higher than conventional produce. By contrast, in July 2022, organic produce was $44.74 or 36.7 percent higher than conventional produce.

Organic produce pricing increased slightly less than conventional prices during and suggests these retailers knew where to draw the line as to what organic customers will spend.

Vitalis

For now, conventional and organic produce sales show an increase compared to last year due to higher retail pricing. The question is: Will we continue to see increased year-over-year sales after the inflation smoke clears?

 

Ron Pelger is a produce industry adviser and industry writer. He can be contacted at 775-843-2394 or by e-mail at ronprocon@gmail.com.

Stemilt Aug 2022
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