Editor's Plate: Even the President Is Eyeing Your Price Increases

April 22, 2024
Biden's State of the Union address urged passage of the Shrinkflation Prevention Act.

Remember when a pint of ice cream was 16oz., not 14? And a can of vegetables was one ounce more than 15? A box of cereal was more than 1 3/4 in. deep? My box of Honey Bunches of Oats still looks substantial at 11 in. tall but it’s only a little thicker than a deck of cards. So it tips over easily.

You've heard consumers griping about food prices and “shrinkflation” for a year now. But now you’re hearing it from the President of the United States and an influential senator, among others. Even Sesame Street’s Cookie Monster.

“Me hate shrinkflation! Me cookies are getting smaller,” Cookie Monster wrote on X (formerly Twitter) in early March. “Guess me going to have to eat double da cookies!”

The first three months of this year saw the heat turned up on shrinkflation and price increases. President Joe Biden mentioned them in his State of the Union Address. If you have some investments with Goldman Sachs, you received a mid-March email with the subject line: What’s up with food prices?

“Why are costs still so high for consumers when monthly inflation has fallen? Corporate greedflation is to blame,” says Robert Casey, U.S. senator from Pennsylvania. Companies are using inflation as a cover to raise prices and make record profits, he charges, while also shrinking the size of products.

Casey released a report in November that shows examples of how pricing outpaced inflation or how some products now come in smaller packages. He doesn’t level all the blame at the food & beverage industry, but it’s his main target. Some of his examples:

  • Family Size Double Stuf Oreos went from 1lb 4oz., now 1lb 2.71 oz.
  • The price of Kellogg’s Frosted Flakes went up 14% from June 2022 to June 2023.
  • In the first half of 2023, Ben & Jerry’s parent company, Unilever, saw its sales volume decline, yet its operating profits increased by 20%.
  • PepsiCo’s CFO admitted in April 2023 that even though inflation was going down, their prices would not.

More importantly, Sen. Casey introduced a bill that would ban shrinkflation by ordering the Federal Trade Commission to treat it as an unfair or deceptive practice, enabling the government to pursue civil penalties in court against companies that do so. Biden hailed the bill in his speech. “Pass Bob Casey’s bill and stop this,” Biden said.

Don’t get me started on CEO pay versus what the average food or beverage company employee makes.

Despite its headwinds, 2023 was a great year for Big Food's finances, at least according to most of the executives who spoke at the February Consumer Analyst Group of New York. I’ve been writing about the food & beverage industry for long enough to remember how the time just before the pandemic was a low point for consumer perceptions of Big Food, when small, socially responsible upstarts were eating away at your market share. But Big Food came through during the pandemic, and consumers owe you a debt of gratitude for that.

The relationship is at an inflection point now. I don’t think any of you want to return to that time. Take a really hard look at any coming price increases, maybe take a look back at last year's and see if any can be rolled back … before Sen. Casey's bill advances.

About the Author

Dave Fusaro | Editor in Chief

Dave Fusaro has served as editor in chief of Food Processing magazine since 2003. Dave has 30 years experience in food & beverage industry journalism and has won several national ASBPE writing awards for his Food Processing stories. Dave has been interviewed on CNN, quoted in national newspapers and he authored a 200-page market research report on the milk industry. Formerly an award-winning newspaper reporter who specialized in business writing, he holds a BA in journalism from Marquette University. Prior to joining Food Processing, Dave was Editor-In-Chief of Dairy Foods and was Managing Editor of Prepared Foods.

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