Food prices at Australia’s two major supermarket chains rose by an average of 5.3 per cent in the June quarter, wealth manager and banking group UBS revealed.
New data from the global financial firm showed the cost of 60,000 grocery products at Woolworths and Coles jumped by 5.5 per cent and 5.3 per cent, respectively, amid supply chain pressures, with analysts predicting another spike in prices in the September quarter.
Fresh produce saw the highest rise in prices at 5.5 per cent, while dry goods soared by 5.2 per cent, UBS reported.
Average food inflation rose 5.3 per cent in the June quarter, compared to 3.8 per cent in the March quarter and 1.2 per cent in the December quarter, UBS said.
Weather events, supply chain issues and other costs have been driving the cost of food in the country over the past 12 months, with some categories rising faster than others.
Coles, Woolworths address price hikes
The country’s top supermarket chains, Coles and Woolworths, said they were committed to keeping prices of goods low as inflationary pressures hit the industry.
Coles, Australia’s second-biggest grocery chain, said the company was focused on keeping costs of the weekly shop down, saying they had reduced prices on more than 1,000 items across their range of more than 20,000 products.
“Coles has also kept prices low on key items our customers rely on to feed their families, like Coles Brand Pasta 500g, famous Coles Mum’s Sauce 500g, Coles Beef & Pork meatballs 560g, and Coles Tuna 95g,” the spokesperson said.
“[These are] just a few of the thousands of products that have remained at the same price for the past year.”
The spokesperson reiterated that Coles introduced the ‘$1 or less’ offers across hundreds of essential everyday items, including pasta, soup, tuna and canned Italian tomatoes.
Rival Woolworths, the country’s largest supermarket chain, stressed it was focused on managing inflationary pressures.
“Managing industry-wide inflationary pressures will continue to be the focus for us as we work hard to provide customers with great value in partnership with our suppliers through programs like Prices Dropped for Winter and Price Freeze, as well as the thousands of weekly specials across our stores,” the spokesperson said.
“While we’re working to continue to provide our customers with great value, it’s important we also support our suppliers in covering their increasing production costs to ensure they can continue to produce the food and grocery needs of all Australians.”
The spokesperson further explained that Woolworths reviewed each cost increase request from its suppliers on a case-by-case basis and was mindful of sensitively managing ongoing inflationary pressures on food and groceries.
“We never make the decision to increase costs lightly and remain committed to delivering competitive prices and great value for our customers,” the spokesperson said.