Unilever hikes prices to beat cost inflation

STORY: Unilever beat forecasts in the first quarter by hiking prices to make up for mounting cost pressures in its supply chain.

The consumer goods giant posted the biggest increases in Latin America - where it lifted prices by over 16%.

Prices in North America went up around half that much.

On Thursday (April 28) Unilever warned that wouldn’t be the end of the increases.

It now predicts it will face cost inflation of about $2.8 billion in the second half of the year.

That’s close to double its earlier forecast.

The firm cited the conflict in Ukraine as one factor, noting that the war has driven a fresh spike in raw material costs.

Prices have surged for ingredients like soybean oil and grains, used in products like Hellmann’s mayonnaise and Knorr stock cubes.

Unilever now expects sales growth at the top end of its forecasts, though profit margins may slip.

Rivals Procter & Gamble and Nestle have also reported strong sales growth in recent days.

But analysts warn the consumer goods firms may soon suffer if consumers switch to cheaper own-brand products.

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