Japan Food Prices:

 Article Source:  https://mainichi.jp/english/articles/20220811/p2g/00m/0bu/032000c

Article:

TOKYO (Kyodo) -- Food prices will continue to surge in Japan for the latter half of 2022, with more than 10,000 items set to rise in price from August onward as import costs of materials become more expensive due to a weaker yen, according to a survey by a credit research company.

The Teikoku Databank survey found prices of 2,431 items are scheduled to rise in August, with hikes for 8,043 more items planned for later this year.

These items would bring the total number of products that have risen in price or are expected to do so this year to 18,532 items, with the average margin of increase standing at 14 percent, the survey showed.

Ideas:

Perhaps Japanese companies have reached the point that they can no longer mantain the profit margins they want or need and now have to pass on part or all their increased costs to the next in the supply chain and or the final customer.

Maybe if the yen hadn't weakened as much as it has Japanese companies would, as usual, been more reluctant to pass on their costs but maybe tried to absorb part or all of their cost increases.

But it is what it is and now Japanese companies have no choice as the yen gets weaker and weaker and raw material other commodities continue to cost more and more.

Perhaps now Japan might be able to say, whether good or bad, it has moved on from the long running delation period in Japan.

Article:

The total number could eventually exceed 20,000 by the end of the year if inflation continues at this rate, the company said.

"Companies are becoming less hesitant to raise prices," a Teikoku Databank official in charge of the survey said. "They are getting quicker to make a move" as they see an increasing number of competitors charge more for everything from pasta to chocolates.

The depreciation of the yen has been pushing up the import costs denominated in yen. Combined with soaring costs for materials such as wheat and edible oil as well as for logistics, an increasing number of items are experiencing price hikes twice or more, the company said.

Ideas:

Competition has a way of being an incentive sometimes to make some kind of action. As companies begin to see other companies begin to increase their prices they don't want to get left behind if they feel that they can sell their products at a higher price too.

Japanese consumers, or some of them, might be feeling a lot of stress now as maybe they haven't seen an increase in prices like this in maybe decades. 

Inflation can be a very individual thing, as for some their price elasticity might be such they really don't notice or don't care about the price increases related to what they price.

But for some just a slight increase in prices could force them to think about buying something cheaper if they can find it.

And there might be some companies who are stressed out about having to increase prices as maybe their customers or some of the customers they have might be fixed income customers and or low-income customers but they have no choice but to increase prices.

Article:

By month, October will see spikes for the largest number of items compared with the other remaining months of the year with 6,305 products, followed by August's 2,431 and September's 1,661.

Of the total of 18,532 items affected by price hikes this year, 7,794 are processed foods such as sausages and frozen foods, 4,350 are condiments including dressings and mayonnaise, and 3,732 are liquor and beverages.

By the end of July, the company compiled the data on price hikes from 105 major food and beverage companies listed on stock exchanges.

Ideas:

The producuts listed for price increases are all the types of foods that might require import raw materials and might be subject to higher prices and as such companies that make these kinds of products probably have no choice but to pass on their costs to the next in the supply chain.

Unfortunately, processed foods seem to be bought more by low-income groups than other groups which means their limited incomes are going to get stretched even more.

But of course as prices continue to increase, if possible, consumers now have to make a choice and maybe need to find substitutes for what they usually buy.

But again price increases can be very individual. Maybe a 100 yen or 200 yen or even a 300 yen price increase is not a big deal for some or many.

But if gets up to maybe 500 yen per product some customers might begin to think its too much for them and they need to look for someething else.

Have a nice and be safe!