Bread being bakes at a Premier Group-owned Blue Ribbon bakery. The group said a global soft commodity price cycle appears to have bottomed.
JSE-listed Premier Group has warned it will likely need to increase the prices of its 52 mainly food-branded products by 5% due to increases in fuel, packaging, and other fuel-related input costs.
The warnings of food price increases follows that of another South African major food manufacturer Tiger Brands, which said two weeks ago the ripple effects of geopolitical uncertainty would not only impact their supply chain, but also consumer disposable income, and additional efficiency improvements and "select price increases" would be necessary to minimise adverse impacts to profitability.
The 202-year-old Premier Group said Wednesday in results for the year to end March that the forecasted El Niño is also expected to impact grain supply and prices negatively going forward. A global soft commodity price cycle appears to have bottomed, the group said.
Ongoing tariff uncertainty will impact its Culinary International division’s sales, but the current 10%/12.5% versus a prior 30% US tariff rate is likely to provide a more favourable trading environment during the key marketing season, than in the previous year.
