Food makers cut prices to reignite growth

Core Insights - After years of price increases, grocery shoppers may see relief as food companies aim to reignite growth [1] Group 1: Price Adjustments - General Mills has cut prices on nearly two-thirds of its grocery products in North America, leading to an increase in product volume [2] - PepsiCo plans to lower prices on some food products this year to enhance affordability [2] Group 2: Consumer Behavior and Inflation - Consumer inflation concerns have negatively impacted product volumes, with PepsiCo reporting a 4% decline in snack volumes and a 3% decline in beverage volumes in North America [3] - Food-at-home prices are projected to rise by 2.3% in 2026, a decrease from the high inflation rates seen during the COVID-19 pandemic [3] Group 3: Commodity Price Influences - Significant price increases in commodities such as coffee (up 18.8%) and ground beef (up 14.9%) have contributed to higher food prices [4] - Consumers earning $100,000 or less are increasingly purchasing discounted food due to high prices [4] Group 4: Strategic Responses - PepsiCo's CEO indicated a need for a reset in affordability as consumers struggle in the U.S. and other Western countries [5] - Despite some price cuts, companies like Hershey are still raising prices in certain categories to counter inflationary pressures, with cocoa prices remaining 70% above 2023 levels [6]