Conagra to Raise Prices as Sales Drop for Quarter

July 14, 2021
Conagra Brands will be raising wholesale prices for its products to make up for rising ingredient costs.

As the pandemic winds down and grocery sales drop, Conagra Brands will be raising wholesale prices for its products to make up for rising ingredient costs.

In a statement accompanying Conagra’s fourth-quarter results, CEO Sean Connolly said that to deal with inflated supply prices, the company’s “aggressive and comprehensive action plan” will include “broad-based pricing.” He noted that Conagra is most likely to feel the impact of inflation in the first half of its fiscal 2022 (which has already started), and that “there will be a lag between the time we are hit with higher costs and when we realize the benefits of our actions” in raising prices.

Conagra’s net sales for the quarter decreased 16.7%, to $2.7 billion, compared with the fourth quarter of last year; organic (same-product) net sales decreased 10.1%. Much of the decline is attributable to how grocery sales spiked last year due to the pandemic. When compared with the fourth quarter of 2019, sales were up 2.4% and organic sales, 4.5%.

For the full fiscal year, net sales were up 1.2%, to $11.2 billion, and organic net sales were up 5.1%.

Conagra is one of a host of food and beverage processors to announce product price increases. PepsiCo, General Mills, Campbell Soup, J.M. Smucker and others have all either raised prices or announced their intention to do so, to deal with rising costs for labor, transportation and packaging, as well as ingredients.

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