Grocers must lower prices as costs fall, says Biden White House -February 2, 2024 at 9:04 PM

Grocers must lower prices as costs fall, says Biden White House -February 2, 2024 at 9:04 PM
Grocers must lower prices as costs fall, says Biden White House -February 2, 2024 at 9:04 PM

The administration of US President Joe Biden is targeting grocery chains with an election proposal to companies to lower the prices of products such as milk, eggs and bread.

“Our message is very clear and the president has and will continue to do so: If you are a company whose input prices have fallen and you are not passing those savings on to consumers, he will call you out on it,” said Jared Bernstein, the chairman of Biden’s Council of Economic Advisers, in a virtual meeting with reporters.

“We have seen increased (profit) margins, especially in the grocery sector, and we have taken note of the need for more to be passed on there (to consumers).”

Bernstein did not name specific companies.

Grocery giants Walmart, Kroger and Albertsons are posting gross profit margins of more than 20 percent, about in line with where they were before the COVID-19 pandemic spiked inflation.

A White House analysis of Census data shows that food and beverage retailers’ revenues as a percentage of their costs have risen sharply from before the pandemic to levels not seen since the mid-2000s, a measure that they believe more directly reflects trading margins.

Last week, Biden said, “There are still too many companies in America ripping people off: price gouging, junk fees, greed inflation, shrink inflation. Biden has urged drug makers to lower insulin costs, hotel chains to lower rates and he has sought to diversify the meatpacking industry after beef prices skyrocketed in the wake of the pandemic.

Biden’s plea for lower supermarket prices comes ahead of the Democrat’s re-election campaign in November. A slew of strong economic data – including stellar jobs and wages data on Friday – has not translated into good approval ratings for Biden, with voters still saying they are concerned about high costs.

Consumer confidence is improving, Bernstein said, citing the University of Michigan consumer survey that showed a rise in sentiment to the highest level since July 2021 and pointing to the recent surge in the U.S. stock market.

“As inflation continues to decline and the job market remains tight and real wages and wage increases continue to outpace price increases, that should show up as improved confidence,” he said.

“We’re also working hard to lower costs — really lower costs, not just lower inflation,” Bernstein said, citing eggs, milk, appliances, airline tickets, used cars and gas as particularly sensitive areas for Americans.

Although eggs make up only 0.1% of the consumer price index, Bernstein said, “in the national psyche it is much bigger than that and we are very aware of that.”

The United Nations food agency’s world price index fell to its lowest level in almost three years in January, due to declines in grains and meat.

Kroger and Albertsons plan to complete a proposed $24.6 billion merger later this year, pending an antitrust investigation over concerns that the deal could raise prices.

“We agree with President Biden,” a Kroger spokesperson said. “Too many grocers in America have increased their margins unlike Kroger.”

The spokesperson added that the merger would “lower prices for even more American consumers by driving at least half a billion in additional price investments in Albertsons stores.”

A spokesperson for the National Grocers Association, which represents independent grocers, called for stricter antitrust enforcement, saying that “the nation’s largest retail chains have used their power to force food suppliers to offset higher production costs by charging their smaller rivals higher prices.” calculate.” (Reporting by Trevor Hunnicutt; Editing by Heather Timmons and Sandra Maler)

The article is in Dutch

Tags: Grocers prices costs fall Biden White House February


PREV Kim Meylemans slides to gold at the European Skeleton Championships!
NEXT Sterling on track for biggest weekly gain against the dollar this year -February 2, 2024 at 1:56 PM