Inflation for grocery staples from peanut butter to pork chops is outpacing price rises for almost all other goods in the nation’s shopping trolleys, even pushing up the cost of Australians’ morning scrape of Vegemite.
UBS analysts said the country was facing “materially high food inflation” and it was starting to affect the buying patterns of consumers, with some switching their branded favourites for cheaper, no-name or house brand alternatives.“Dry grocery inflation is likely to remain elevated as pressures on commodities and the domestic supply chain including labour continue in 2023, although the frequency of price rises may reduce,” the analysts found.
Some supermarkets have already noticed consumers moving towards cheaper cuts of meat or bulk purchases of certain foods because of high prices. Treasurer Jim Chalmers said the government was aiming to get wages growing to help offset inflation. Wage growth hit an 11-year high of 3.7 per cent in the year to the end of March.
“We know that Australians are under the pump, we know that cost of living pressures are biting, and that’s why so much of the government’s focus over the first 12 months has been taking some of the edge off these cost of living pressures without adding to inflation,” he said.
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