Nestle and Danone Anticipate Slower Food Price Inclines in the Coming Year
Source: The DairyNews
Major food industry players Nestle and Danone are forecasting a deceleration in food price increases for the upcoming year following substantial hikes that impacted demand for both companies.
Nestle CEO Mark Schneider indicated on Thursday, post the release of results, that "pricing will be a lot lower this year than last year." He emphasized a shift towards growth driven by volume and mix, suggesting a more widespread trend in the industry.
Nestle reported organic sales growth of 7.2% for the year ending December, slightly below analysts' projections of 7.4%. Meanwhile, Danone disclosed a 7% increase in like-for-like sales, with price escalations compensating for a 0.4% dip in volumes.
In recent years, elevated costs triggered by the pandemic and geopolitical events, such as the conflict in Ukraine, prompted both companies to implement noticeable price hikes. However, consumers are now seeking more economical alternatives, according to Nestle and Danone, aligning with the trend indicated by competitor Unilever PLC earlier this month.
Unilever, a fellow consumer goods giant, suggested a moderation in price increases owing to subsiding inflation in its recent financial results. Antoine de Saint-Affrique, Danone's CEO, acknowledged a slowdown in inflationary pressure but cautioned that price hikes might still persist, noting, "We expect to have a price component in our growth; it will differ by region."
Nestle reported organic sales growth of 7.2% for the year ending December, slightly below analysts' projections of 7.4%. Meanwhile, Danone disclosed a 7% increase in like-for-like sales, with price escalations compensating for a 0.4% dip in volumes.
In recent years, elevated costs triggered by the pandemic and geopolitical events, such as the conflict in Ukraine, prompted both companies to implement noticeable price hikes. However, consumers are now seeking more economical alternatives, according to Nestle and Danone, aligning with the trend indicated by competitor Unilever PLC earlier this month.
Unilever, a fellow consumer goods giant, suggested a moderation in price increases owing to subsiding inflation in its recent financial results. Antoine de Saint-Affrique, Danone's CEO, acknowledged a slowdown in inflationary pressure but cautioned that price hikes might still persist, noting, "We expect to have a price component in our growth; it will differ by region."
