Rising input costs: Get ready to pay more for groceries

Even as the consumer goods segment still reels under the impact of demonetisation, rising input costs are pushing FMCG biggies to increase prices of their products or slash the quantities of packaged goods this summer. As a result, biscuits, ice-creams and soap, among other daily consumption products will get expensive in the coming months.

Over the past year, the costs of essential ingredients such as sugar, milk powder and palm oil have increased by 20-80 percent owing to volatile commodity prices and lower production cycles. Britannia, Amul, Dabur and Parle are among the first few FMCG majors to plan increase product prices, ET reported on Monday.

While Britannia plans to increase biscuit prices by up to 7 percent, Santoor soap maker Wipro Consumer Care will hike prices by about 5 percent. Amul is increasing product prices by 5-8 percent after nearly two years, according to the report.

“We will cover up the inflation hit and hike prices 6-7 percent,” Varun Berry, Managing Director, Britannia, told the paper.

Meanwhile, Parle and Dabur are cutting down on quantities or holding back on promotions. After four years, Parle Products has reduced the weight of its confectionery and snacks category. Parle products’ weight reduction translates in to a price hike of about 8-12 percent, according to the report.