How Australia’s shrinkflation crisis is getting worse


By Stephen Johnson, Economics Reporter For Daily Mail Australia

05:56 20 Mar 2024, updated 21:42 20 Mar 2024

Australian consumers are being ripped off at the supermarket with hot cross bun prices rising by double-digit figures in a year – even as volumes shrink.

Consumer group CHOICE has revealed the extent of the ‘shrinkflation’ crisis where products are sold at a much higher – or the same – price, despite packets having less inside.

This is affecting foods from hot cross buns to breakfast cereal, biscuits and cleaning products. 

Value for money is being eroded at the supermarket checkout, even though inflation is officially moderating. 

With Easter Sunday just 11 days away, hot cross buns are getting a lot more expensive, with less to show for it.

Australian consumers are being ripped off at the supermarket with hot cross bun prices rising by double-digit figures in a year – even as volumes shrink

Community Co’s traditional and chocolate varieties have shrunk by 30 grams since last year.

But the price has risen by 12.5 per cent to $4.50, up from $4, even though the volume has shrunk by 6.3 per cent to 450 grams, as of February 2024, down from 480 grams in February 2023.

The increase in hot cross bun prices is more than triple January’s annual inflation rate of 3.4 per cent.

A spokeswoman for Metcash, the group behind IGA that stocks the Community Co hot cross buns, said production costs had increased as a new supplier was found.

‘The price also increased from $4 to $4.50 due to recipe improvement, which included increasing the chocolate chip content from 18 per cent chocolate (cocoa and milk chips) to 20 per cent chocolate (cocoa and dark chips) and the rising cost of goods including the increase in the cost of flour and chocolate,’ she told Daily Mail Australia.

‘That being said, our Community Co hot cross buns are part of our Price Match Program which matches the lowest regular shelf price, of Coles and Woolworths on hundreds of everyday products, so the price has come down to $4, so while the pack size has decreased slightly, the price remains the same as last year.’ 

When it comes to breakfast cereals, the major supermarkets are among the worst offenders, selling a cheaper version of Kellogg’s Nutri Grain.

Coles in October 2022 was selling 560 gram packets of Mighty Grain breakfast cereal for $4.50.

But in March 2024, the product was sold at the same price with 495 grams of cereal – an 11.6 per cent reduction in volume with no price cut.

When it comes to breakfast cereals, the major supermarkets are among the worst offenders, selling a cheaper version of Kellogg’s Nutri Grain

A Coles spokeswoman told Daily Mail Australia the supplier of Mighty Grain had incurred higher production costs.

‘We can assure our customers that we have not profited from the change in pack size of Coles Mighty Grain and Coles Corn Flakes cereals and that all of the cost price relief has been retained by our supplier who has experienced increases in the cost of production and raw ingredients,’ she said.

‘Our supplier let us know it was changing the pack size for its cereal products both branded and private label so that it could simplify production and supply chain.’

Rival Woolworths was selling a 560-gram packet of Max Charge for $4.50 in September 2023 but by this month, the size had shrunk to 495 grams.

But a Woolworths spokeswoman told Daily Mail Australia its house-branded products were 30 per cent cheaper than similar-branded products.

‘Our suppliers requested the changes in pack sizes,’ she said.

‘We can confirm that there was no financial benefit to Woolworths by changing the size of these products, as the cost from the supplier to us did not decrease. 

‘On average, these two products are also more affordable than similar branded products.’

In the year to January, bread and cereal prices rose by 7.4 per cent, Australian Bureau of Statistics figures showed. 

The shrinkflation crisis is also affecting biscuits with McVitie’s Go Ahead range of ‘forest fruit’ products staying at $4.40 despite shriveling by 20.2 per cent to 174 grams, down from 218 grams, since June 2022.

The ‘shrinkflation’ crisis is affecting foods from hot cross buns to breakfast cereal, biscuits and cleaning products

Cleaning products are also getting dear despite consumers getting less.

In the case of Jif’s Power & Shine Bathroom cleaner, the cost has risen by 60 per cent to $4, up from $2.50 in May 2022.

This is despite the volume of the bottle shrinking by 28.6 per cent to 500 millilitres, down from 700 millilitres.

The price per 100ml has more than doubled. 

Daily Mail Australia also approached Community Co, United Biscuits and Unilever Australia for comment. 



This article was originally published by a www.dailymail.co.uk . Read the Original article here. .