ConAgra Is Raising Grocery Prices. Here's When You'll Start To Notice
Brace your wallet, the trip to the grocery store could be getting even more expensive. ConAgra, the Chicago-based manufacturer of brands like Duncan Hines, Birds Eye, Slim Jim, and Chef Boyardee, and frozen dinners including Marie Calendar's, Healthy Choice, and Hungry-Man, announced this week it plans to raise prices to outpace inflation driven production costs (via The Street).
According to the Associated Press, inflation jumped 6.4% from February 2021 to February 2022, the largest single-year jump in prices since 1982, with the biggest contributors to the rise being food and fuel. In light of the unanticipated expenses, The Street reports ConAgra has lowered its expected earnings estimates for 2022 by 10 cents to $2.35 per share.
"We experienced higher-than-expected cost pressures as the third quarter progressed and expect those pressures to continue into the fourth quarter, particularly in certain frozen, refrigerated, and snacks businesses," ConAgra CEO Sean Connelly stated. "In response, we have taken steps to implement additional inflation-driven pricing actions." While the increased prices are coming to quite a few popular brands, it will take a little time before you start to see the change reflected on your local grocery store shelves.
When will ConAgra brands become more expensive?
ConAgra's announcement that it plans to increase prices comes on the heels of a USDA forecast anticipating grocery prices to rise even more in nearly every category in the coming year. The new prices are unlikely to impact customers until the first quarter of 2023's fiscal year, per The Street, when ConAgra CEO Sean Connelly explained the company can expect to "see the benefits of these actions."
The USDA's forecast anticipates an overall increase of 3-4% for food prices, with the estimated cost of eating in restaurants expected to rise 5.5-6.5%. Those increases are on top of the already high prices brought on by the pandemic, supply chain issues, worker shortages, and extreme weather, which CNBC reports have caused some items to increase in price by almost 15%.
Other factors expected to contribute to the growing inflation include an outbreak of bird flu driving up poultry and egg prices and the war in Ukraine creating a potential global wheat shortage. U.S. meat prices could also rise higher if the Supreme Court votes to uphold a California regulation which would require stricter animal welfare standards for pork producers.