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These companies are jacking up prices because of exploding inflation

·Anchor, Editor-at-Large
·5 min read
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The cost of doing business is on the rise as the COVID-19 pandemic rounds the corner.

On Wednesday, the Labor Department reported the Consumer Price Index (CPI) spiked 4.2% in April, the quickest jump in more than 12 years. Excluding volatile food and energy prices, the core CPI rose 3% year-over-year. It gained 0.9% alone for April. 

The inflationary pressure in April — which many Federal Reserve officials see as transitory effects from the pandemic recovery — reflected a 25% increase in energy prices from last year. Used car prices skyrocketed 21% from a year ago.

While investors were surprised by the report and sent stocks lower across the board, the data shouldn't have been a shocker.

Oil prices are up nearly 250% from a late January 2020 bottom. Copper prices have surged 85% during that same timespan. The average price of gas in the U.S. since late April 2020 has gone from about $1.74 to more than $3.00. Not helping matters for companies are the new costs in businesses to keep workers safe from the ongoing pandemic. Meanwhile, companies from Chipotle to Sheetz are lifting hourly wages to attract much-needed new employees and retain existing ones.  

Corporate America is now asking consumers to foot the bill in an effort to protect their bottom lines from inflation and COVID-19 pandemic costs, and their stock prices. 

Here are several of the biggest consumer brands that have said recently they have raised prices or are about to do so thanks to rising inflation. 

General Mills

General Mills — maker of everything from Cheerios to Blue Buffalo pet food — is continuing to see strong sales of its packaged food amidst the pandemic. But despite the sales strength, the company is looking at increasing prices to offset inflationary pressures. 

This is a display of General Mills Cheerios cereal at a Costco Warehouse in Homestead, Pa, on Thursday, May 14, 2020. (AP Photo/Gene J. Puskar)
This is a display of General Mills Cheerios cereal at a Costco Warehouse in Homestead, Pa, on Thursday, May 14, 2020. (AP Photo/Gene J. Puskar)

"We are seeing great growth across our North American business, in particular our pet business, and are seeing rising cost pressures and increased costs to serve," General Mills CEO Jeff Harmening told Yahoo Finance Live. "The inflation is broad-based, we see it in grains and logistics not only here in the U.S. but also globally. Fortunately we have good productivity programs and are looking for some pricing to put in place. We have the tools we need in order to battle it, but we are starting to see inflation as are most of our competitors."

Hormel

The producer of Spam is dealing with inflationary pressures as well, as the higher cost of feed for livestock pushes up prices for deli meats. Hormel told analysts in February that it raised prices on Jennie-O products to counteract inflation.

"So as we obviously follow the inflationary factors and see what's happening in the business, we feel very confident in our ability to price," Hormel CEO Jim Snee said

Reynolds

Tin foil won't be getting cheaper anytime soon, at least tin foil from Reynolds.

“We expect 2021 to be another year of record net revenues and volume and are using all available tools, including additional pricing and expanded Reyvolution cost savings, in our plans to offset increased commodity, logistics and related costs,” said Reynolds (REYN) CFO Michael Graham on the company's latest earnings report. “Our first round of price increases went into effect as planned, and a second round is underway with plans for a third round in the third quarter. However, there is a difference between the impact of recent cost increases and the timing of related price increases. We therefore expect considerable margin pressure in the second quarter, followed by sequential margin improvement in the third and fourth quarters as higher prices go into effect.”

Procter & Gamble

Time to budget a little more for personal care products.

The maker of Tide laundry detergent and Gillette razors said in its fiscal third quarter earnings release it would begin to hike prices on baby care, feminine care and adult incontinence products in the United States. Price increases will range from mid- to high-single digit percentages. The hikes will go into effect in mid-September.

Procter & Gamble's Tide laundry detergent fills the shelves of a department store on Thursday, June 14, 2018, in Aventura, Fla. (AP Photo/Brynn Anderson)
Procter & Gamble's Tide laundry detergent fills the shelves of a department store on Thursday, June 14, 2018, in Aventura, Fla. (AP Photo/Brynn Anderson)

P&G Vice Chairman and COO Jon Moeller told Yahoo Finance Live the price increases will have a neutral impact to earnings, but were necessary given the cost increases the business is experiencing. 

Whirlpool

That kitchen remodel is likely to be costlier than you thought. 

"We took price increases in every region of the world, and range from 5% to 12%," Whirlpool (WHR) CFO Jim Peters told Yahoo Finance Live. "Those are driven by commodity cost increases, and it's something we have done historically."

Key commodities for Whirlpool have surged since March 2020 — steel and oil prices alone are up about 75% and 90%, respectively, alone over that span. 

"Supply chain issues and cost of materials are the top concerns of members," National Kitchen & Bath Association Bill Darcy told Yahoo Finance Live. "The long lead times and the price increases are significantly impacting our members, and certainly consumers.

Kimberly-Clark

Protecting your hands from a germy sneeze will also set you back some more money, too. 

The Kleenex maker said on March 31 it will increase prices in the U.S. and Canada on the majority of its consumer products due to "significant" commodity cost inflation. The percentage increases will range from mid- to high-single digits and go into effect in June. 

The most impacted will be baby and child care products, adult care products and Scott bathroom tissue. 

Tempur Sealy

Getting a great night's sleep is going to cost a little more. 

Tempur Sealy (TPX) Chairman and CEO Scott Thompson told Yahoo Finance Live the company took a new round of price increases on April 1 to combat higher steel and chemicals prices. Thompson didn't disclose the degree of the price increase.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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