Food prices have been on the rise and supermarkets are stockpiling inventory as a result, The Wall Street Journal reported Tuesday.
With prices expected to rise even further, grocery stores are stocking up on supplies to meet demand, keep costs down and protect profit margins, The Journal reported.
Some grocery industry executives told The Journal that the price increases might be among the highest seen in recent history.
Stockpiling items can lead to shortages and a disruption in the already impacted U.S. supply chain, executives said.
Associated Wholesale Grocers Inc., the nation’s largest wholesaler, recently purchased 15 to 20 percent more inventory, according to CEO David Smith.
General Mills, Campbell Soup Co. and J.M. Smucker Co. have raised prices to make up for higher costs, The Journal reported.
One retailer based in Grand Rapids, Michigan, said it is stockpiling about 20 to 25 percent more groceries in response to warnings from over 100 suppliers that they plan to raise prices, according to The Journal.
“When you have a uniquely inflationary period like now, it’s a feeding frenzy,” Tony Sarsam, CEO of SpartanNash Co., said.
Retailers walk a fine line when deciding what and how much to purchase, taking into account shelf life, storage space and competitor prices.
“If Walmart raises prices, so will we,” Mark Griffin, president of B&R Stores Inc., told The Journal.
Along with wholesale prices, consumer prices have also been on the rise to keep up with inflation.
According to a Trafalgar Group poll published last month, 40 percent of likely general election voters believe President Joe Biden is responsible for inflation. The poll was conducted from June 3 to June 7 among 1,073 respondents with a margin of error of +/- 2.99 percentage points.
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