There is an increase in price on select Grace products, including Grace Mackerel and Grace Tomato Ketchup. Grace Foods and Services, the production and distribution division of GraceKennedy Limited, implemented the price adjustment several days ago, and the new prices reflect an increase of about 5 per cent.
On Friday, GraceKennedy Group CEO Don Wehby disclosed that the company has been “receiving increases in prices” from suppliers of “up to 8 to 10 per cent.”
He noted that while some of the company’s items had a price increase, the price of corned beef remained the same. Consumers will also find that the prices of Grace Cock soup, Tastee Cheese, Tropical Rhythm, Grace syrups, Grace powdered and canned Coconut Milk, Grace Refined Vegetable oil, Grace Instant Chocolate, Vienna Sausages and frankfurters and Grace Kidney Beans have all increased.
With raw material shortages, shipment delays, port congestion, and irregular and unclear delivery schedules being major issues, many manufacturing and distributing businesses have been keeping more inventory to prevent stock-outs. Thus, rising storage costs, higher corporate spending, and inflation have been driving up input prices.
According to the Jamaica Gleaner, GraceKennedy Group reported an inventory of $20 billion, compared to $15 billion a year ago. Additionally, during the past nine months, the operating margin for the food trading division has decreased from 6.1% to 4.9%.
On Monday, during the company’s third quarter briefing, Wehby stated that some suppliers raised prices to “35 per cent for some mainstream products,” but GraceKennedy could not do the same. The company’s ability to move goods has also been adversely affected by shipment delays and port congestions.
For example, in the first quarter of 2022, the number of containers received doubled to 150, partly due to wharf congestion and inconsistent product supply. Wehby subsequently pledged to keep looking into new opportunities for GK to increase its efficiency in order to reduce the pass-through to customers.