Panic buyers cause permanent price rise in grocery stores.
It turns out all those people who stocked up on toilet paper and pasta at the height of the coronavirus pandemic last year were wreaking more damage than anyone could have predicted.
Not only was it a nightmare for those who ran out of loo rolls or had nothing to eat at the time but now, 18 months later, our banks account are feeling the pinch.
New research has found that panic buying pulled up grocery prices, and now those prices are here to stay.
As yet unreleased data from Deakin University?s Institute for Health Transformation analysed about 7000 Coles and Woolworths products over the last three years and found a disturbing trend ? food staples are on the rise.
Most common household purchases went up by anywhere from two to seven per cent, but in some extreme cases they were as high as 37 per cent.
Lead researcher and Deakin University Associate Professor Kathryn Backholer told news.com.au, ?These are not normal prices. We account for the consumer price index (but these) price changes are over and above inflation.?
The researchers suspect that since the pandemic began in March last year, labour shortages, supply chain issues, Covid-19 safety protocols as well as panic buying has pushed up prices.
Since the pandemic started back in March, fresh fruit went up by seven per cent, oils went up by four per cent, long-life milk and legumes are both three per cent higher, and fresh milk and eggs rose by two per cent, the researchers found.
In a more extreme individual case, dried pasta jumped by 15 per cent. In fact, one brand even rose by a whopping 37 per cent on its original price back in February last year, from $1.90 to $2.60.
Butter went from $3.80 to $4.30, a leap of 13 per cent, while sultanas surged from $7.50 to $8.40, which is 12 per cent.
?We looked at the price increase during that first wave (of Covid). It was a four-month period across most states and territories, we saw prices go up during that period,? Prof Backholer said.
?We looked at what happened during that period of relative stability afterwards.
?They (prices) didn?t come back down.?
However, the grocery price increase isn?t solely down to panic buyers who were slammed as ?idiotic? at the time.
International and interstate border closures have led to supply chain issues and labour shortages, meaning supermarkets are struggling for staff at all levels of operation, from producing the food, to delivering it and stacking shelves.
Fruit pickers ? a group usually dominated by overseas workers ? are also in short supply, leading to harvests not being as profitable as normal.
Prof Backholer said the price rise was a ?double whammy? for Australians with the cost of living on the up but wages not growing at the same rate.
?For me it highlights the vulnerability of our food system to shocks more broadly,? she added.
?This time around it was Covid-19. We?re only going to see more shocks in the future with climate change and extreme weather events that disrupts the food chain.?
To stop these ?volatile prices?, diversification was key, she said.
?For coffee we rely on one, maybe two regions in the world. We should consider growing and producing certain products locally and give support to our farmers,? she added.
The research report is expected to be released early next year.
Link to article: https://www.news.com.au/finance/business/retail/panic-buyers-cause-permanent-price-rise-in-grocery-stores/news-story/9d87159bee920819e02dfeba4169aa21
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We all know it is govt spending and RBA money printing that is causing inflation.
It turns out all those people who stocked up on toilet paper and pasta at the height of the coronavirus pandemic last year were wreaking more damage than anyone could have predicted.
Not only was it a nightmare for those who ran out of loo rolls or had nothing to eat at the time but now, 18 months later, our banks account are feeling the pinch.
New research has found that panic buying pulled up grocery prices, and now those prices are here to stay.
As yet unreleased data from Deakin University?s Institute for Health Transformation analysed about 7000 Coles and Woolworths products over the last three years and found a disturbing trend ? food staples are on the rise.
Most common household purchases went up by anywhere from two to seven per cent, but in some extreme cases they were as high as 37 per cent.
Lead researcher and Deakin University Associate Professor Kathryn Backholer told news.com.au, ?These are not normal prices. We account for the consumer price index (but these) price changes are over and above inflation.?
The researchers suspect that since the pandemic began in March last year, labour shortages, supply chain issues, Covid-19 safety protocols as well as panic buying has pushed up prices.
Since the pandemic started back in March, fresh fruit went up by seven per cent, oils went up by four per cent, long-life milk and legumes are both three per cent higher, and fresh milk and eggs rose by two per cent, the researchers found.
In a more extreme individual case, dried pasta jumped by 15 per cent. In fact, one brand even rose by a whopping 37 per cent on its original price back in February last year, from $1.90 to $2.60.
Butter went from $3.80 to $4.30, a leap of 13 per cent, while sultanas surged from $7.50 to $8.40, which is 12 per cent.
?We looked at the price increase during that first wave (of Covid). It was a four-month period across most states and territories, we saw prices go up during that period,? Prof Backholer said.
?We looked at what happened during that period of relative stability afterwards.
?They (prices) didn?t come back down.?
However, the grocery price increase isn?t solely down to panic buyers who were slammed as ?idiotic? at the time.
International and interstate border closures have led to supply chain issues and labour shortages, meaning supermarkets are struggling for staff at all levels of operation, from producing the food, to delivering it and stacking shelves.
Fruit pickers ? a group usually dominated by overseas workers ? are also in short supply, leading to harvests not being as profitable as normal.
Prof Backholer said the price rise was a ?double whammy? for Australians with the cost of living on the up but wages not growing at the same rate.
?For me it highlights the vulnerability of our food system to shocks more broadly,? she added.
?This time around it was Covid-19. We?re only going to see more shocks in the future with climate change and extreme weather events that disrupts the food chain.?
To stop these ?volatile prices?, diversification was key, she said.
?For coffee we rely on one, maybe two regions in the world. We should consider growing and producing certain products locally and give support to our farmers,? she added.
The research report is expected to be released early next year.
Link to article: https://www.news.com.au/finance/business/retail/panic-buyers-cause-permanent-price-rise-in-grocery-stores/news-story/9d87159bee920819e02dfeba4169aa21
--------------------------------------------------------------------------------
We all know it is govt spending and RBA money printing that is causing inflation.