By Richa Naidu, Canan Sevgili, Olzhas Auyezov
LONDON/GUDANSK/KAZAKHSTAN (Reuters) – Istanbul banker Seyda Baru is so worried about rising food prices that she has fallen into a pandemic-era habit of hoarding packaged goods like coffee and toilet paper. Oops.
“I buy a lot of basic foods like oil, pasta, rice, tahini and molasses.
Russia’s invasion of Ukraine has pushed energy and grain prices to all-time highs, driving up the cost of packaged goods. This is particularly acutely felt in parts of Asia and North Africa, where people spend more income on food and fuel than in the US or Europe, prompting some shoppers to stockpile non-perishable goods. has become
This trend hasn’t gone unnoticed by Nestle, the world’s largest packaged food company and home to more than 2,000 brands, including Cheerios, Nescafe and Maggi.
The Swiss group is adjusting its product range in the region to “make it more meaningful to consumers,” according to Karim Al-Bitar, head of consumer research and market intelligence at Nestlé Middle. and are considering whether to make some products “more affordable”. East and North Africa (MENA) Unit.
This includes increasing pack size or changing to cheaper ingredients.
“Nestlé seems to be hoarding broths, some soups and certainly coffee,” Al-Bitar told Reuters.
Maggi products and Nescafé coffee sachets are among popular products for stockpiling, he added.
Nestlé has worked with local partners to overcome supply challenges and has been able to keep stock on shelves so far, the company said in an emailed statement.
The MENA region contributes more than 4% of Nestlé’s annual sales, or CHF 3.7 billion ($3.9 billion). The region including Central Asia accounts for about 9%, or CHF8 billion.
Stock up or pay extra later
Hani Weis, CEO of Majid Al Futtaim Retail, which operates more than 450 Carrefour stores in 16 countries, said shoppers are increasingly interested in non-essential items such as electronics, clothing and household items. Demand for packaged food and personal care products is on the rise, he said, even as he cuts spending. in the Middle East, Africa and Asia.
“What do people worry about? Inventory availability,” Weiss said, adding that retailers are experiencing inflation on average of around 9.5%, with Egypt, Kenya added that countries such as Georgia are under particular pressure.
Several countries in North Africa and Central Asia are experiencing repeated shortages of basic necessities. Euromonitor International analyst Camille Botillute said people in Tunisia, Algeria, Libya and Morocco are having trouble finding flour, sugar and baked goods. Botyriute said some stores in Tunisia began rationing goods in August to prevent consumers from hoarding.
“I bought about ten bags of 50 kilograms of flour and the same amount of sugar,” said Elder, 28, an entrepreneur based in Almaty, Kazakhstan. “There were rumors of an expected sugar shortage, so I wanted to stockpile.”
In the same city, furniture designer Ivan, 47, said: later. “
Invoice, Invoice, Invoice
Many countries in Central Asia and North Africa are experiencing faster inflation than North America and Europe, where consumer price growth in the 19 euro-sharing countries accelerated to 8.9% in July.
Annual inflation in Turkey reached a 24-year high of 80% in August, while Egypt accelerated to 13.6% in July. In many cases, the depreciation of the local currency drives up import costs.
Unilever CEO Alan Jope said in July, “In Turkey, consumers are adapting to the reality of very high inflation. and market volumes are holding up thanks to pantry loading,” said Sinem Ozer, 31, a marketing expert who lives in Istanbul. And so on. Previously he spent about 300-400 Turkish lira ($16.71-22.27) for a month’s shopping, now he spends the same amount in a week and Nescafe’s he spends 3 in 1 He also buys instant coffee in packs of 20% extra.
But not everyone can stock up.
“I don’t have money to buy a lot of things,” said Layla, a 60-year-old shopper, standing in front of Lafayette Market in Tunis, Tunisia. “Most of the time, I have to take out a loan from a relative to complete the month.”
($1 = 18.1455 lira)
($1 = 0.9643 Swiss Francs)
(Reporting by Richa Naidu; additional reporting by Mohamed Argoubi from Tunisia; editing by Matt Scuffham and Mark Potter)