Due to the Russo-Ukraine war, the prices of all three commodities, crude oil, palm oil and wheat, increased wildly. These three commodities are the biggest raw material for FMCG companies. Crude prices increased by 124 percent in the last one year. The price of palm oil has increased about one and a half times in a year. Wheat prices in the global market rose 50 percent to $ 14 per bushel.
Inflation at 8-month high.
in India Dearness ,inflation) is under control. After reading the news of record inflation in US-Europe, if retail inflation (Retail InflationIf the figures are giving you comfort, then believe me, it is like closing the eyes of a pigeon after seeing a cat. This is not a joke. You just bought in the last six months ration ,RationTake out the leaflets of ) and calculate, surf, soap, biscuit, namkeen, Maggi, Manjan, coffee-tea, oil-refined, milk-bread everything has become expensive. There is every possibility that it will be more expensive in future. country’s largest FMCG ,FMCG) Company Hindustan Unilever ie HUL The price has been increasing continuously for the last six months. The latest boom may not have reached you in the hustle and bustle of Holiâ€¦
price of which item increased
The company increased the price of surf soap by 2 to 17 percent. In the last six months, the prices of products have increased by 25 to 30 percent. That is, goods like Rin, Surf Excel, Bim Bar, Bru-Coffee, Taj Mahal, Lux, Dub will be seen as expensive in the prescription.
HUL is not aloneâ€¦ Maggi made in 2 minutes became more expensive by Rs. The new price increased from Rs.12 to Rs.14. Mayank Shah, Senior Category Head, Parle Products, said in his latest interview that the industry is expecting a 10-15% increase in prices.
Explaining his dilemma, Shah was saying that there is a lot of volatility in the market. Crude oil of $140 per barrel came down to 100. Palm oil of Rs 180 per liter is now at 150. In such a situation, it is difficult to say right now how much the price increase will be.
Companies are also afraid that demand will break due to increase in prices, which has not even been able to run properly after the recession. According to Ankush Jain, Chief Financial Officer, Dabur India, high inflation continues to be a cause for concern.
Consumers have reduced their spending due to inflationary pressures. They are buying smaller packs. We are watching our situation and after due deliberation, we will take measures to avoid inflationary pressure.
Companies have not yet passed on the entire inflation of raw materials to the consumer, its reflection is also visible in the inflation data. Wholesale inflation is beyond 13 per cent while retail inflation is close to 6 per cent. You can consider wholesale inflation as inflation of companies. That is, companies are getting raw material 13 percent more expensive than last year. The entire inflation has not been passed on to the consumer.
Now understand what is the real reason for inflation?Due to the Russo-Ukraine war, the prices of all three commodities, crude oil, palm oil and wheat, increased wildly. These three commodities are the biggest raw material for FMCG companies. Crude prices increased by 124 percent in the last one year.
The price of palm oil has increased about one and a half times in a year. Wheat prices in the global market rose 50 percent to $ 14 per bushel. The price of flour in Delhi has increased by 17 percent in the last one year. The flour of Rs.24/kg started selling at Rs.28/kg.
Packaging accounts for about 10 to 15 percent of the cost of FMCG companies. Raw material for the packaging industry is expensive on the lines of crude oil. That is, the faster the crude oil, the more expensive the packaging material. Apart from this, after the cost of bulk diesel and coal, the cost of energy for companies has also increased. Believe me, if the war does not end soon, we will all get scorched in the heat of inflation.