Inflation

Inflation Blame Shifts From Pandemic to Supply Chain: Consumer Brands, Ipsos Poll

Additionally, 72% of respondents say rising grocery prices are having a very or somewhat significant effect on their budgets
grocery inflation
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As rising prices continue to burden American consumers, they are shifting their blame for grocery inflation from the pandemic to the supply chain, according to a recent poll from the Consumer Brands Association and Ipsos.

In February, 21% of survey respondents said supply-chain costs and constraints were responsible for rising grocery prices, with that percent rising to 27% in June. Conversely, 30% of respondents said the pandemic was the root cause in February (the top cause in the month) vs. 19% in June.

In June, President Joe Biden’s polices, at 29%, led as the top cause for grocery inflation—a 2-point percentage increase from 27% in February.

“The changes are reflective of a volatile four months that has left the pandemic largely in the rearview yet has kept ongoing supply chain problems clearly visible,” Katie Denis, VP of communications and research for Consumers Brands, said in a blog about the report.

Pandemic shutdowns and slowdowns, extreme weather, the war in Ukraine and other geopolitical issues have all contributed to supply-chain constraints and, thus, the increase in wholesale costs, Consumer Brands said. Approximately 70% of the CPG industry’s costs come from wholesale inputs, the association said. The Producer Price Index, meanwhile, has been at or near record highs for 15 consecutive months, with key commodities for the CPG industry, such as wheat, diesel, aluminum and more, rising above average PPI. 

“Before the pandemic, most Americans knew little to nothing about the supply chain. Now, they have seen its challenges front and center. They know that solving those challenges makes a difference in their daily lives and they expect action from their political leaders,” said Denis.

In the Consumer Brands/Ipsos poll of 1,000 American adults, conducted June 17-20, 72% of respondents said increased grocery prices were having a very (34%) or somewhat significant (38%) effect on their household budgets. Only 22% said it was having a not very significant impact and just 6% said it was having no impact. 

“To account for increased costs to their household budgets, more Americans are limiting their driving, large purchases or travel and entertainment than cutting grocery spending, which speaks to the essential nature of the CPG industry’s products and the responsibility the industry feels to keep products as affordable as possible,” Denis said.

 

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