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Kraft Heinz CEO predicts continued inflation, more price increases next year

Fox Business logoFox Business 10/24/2022 Aislinn Murphy
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Kraft Heinz CEO Miguel Patricio predicted in a recent interview that inflation will persist and more price increases will happen in 2023.

He made the comments during a CNN Business interview published Monday in which he discussed certain challenges impacting the food industry. 

"We’ve already increased the prices that we were expecting this year, but I’m predicting that next year, inflation will continue, and as a consequence [we] will have other rounds of price increases," he told the outlet.

Both consumer and wholesale inflation have been hovering at painfully high levels, FOX Business previously reported.

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The consumer price index in September rose 0.4% from August and 8.2% from the prior year. Meanwhile, in the same month, the producer price index climbed 0.4% on a monthly basis and 8.5% on a yearly basis.

This Wednesday, March 25, 2015, file photo shows the Kraft logo outside of the company's headquarters in Northfield, Ill. Kraft Heinz is recalling thousands of pouches of Capri Sun after some cleaning solution accidentally mixed with the juice on a production line. AP Photo/Nam Y. Huh, File © AP Photo/Nam Y. Huh, File This Wednesday, March 25, 2015, file photo shows the Kraft logo outside of the company's headquarters in Northfield, Ill. Kraft Heinz is recalling thousands of pouches of Capri Sun after some cleaning solution accidentally mixed with the juice on a production line. AP Photo/Nam Y. Huh, File

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Kraft Heinz has attempted to "minimize inflation on everything we do," Patricio reportedly said, noting it would be "very easy to just pass the price to consumers, but that has consequences." 

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Some steps the company has taken related to costs include being "much more efficient in our factories," as well as offering bulk value packs of certain products and different product size options, Patricio told CNN Business.

In the second quarter, its pricing jumped 12.4% compared to the same three-month period the year prior, the company said in its July earnings release.

The Kraft Heinz CEO indicated he thinks supply challenges will continue as well.

"Every day we have a new problem. It’s the new normal," he told CNN Business. "At the beginning we thought it was a crisis — now we know it’s a new normal and we have to adapt to that."

The company has been trying to anticipate potential supply issues and adapt to them faster, according to Patricio. 

"Every day there’s a shortage of something," he also said during the interview, giving examples of shortages of tomatoes, potatoes and beans

Patricio, however, reportedly expressed confidence about there not being any Heinz ketchup shortages, saying, "We predicted that we would have a problem with the crop of tomatoes so we bought them in advance."

bottles of Heinz Tomato ketchup in a store. Education Images/Universal Images Group via Getty Images © Education Images/Universal Images Group via Getty Images bottles of Heinz Tomato ketchup in a store. Education Images/Universal Images Group via Getty Images

Kraft Heinz, which produces ketchup, Classico pasta sauces and other food products, told FOX Business earlier in October that this season's tomato crop in California — a state battling an ongoing drought — "has resulted in lower yields overall."

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"However, we do not predict a gap in service for any Kraft Heinz products where tomatoes are a critical ingredient," the company's statement read. "To maintain production, our cross-functional team put a strategy in place that uncovered alternative regions to source tomatoes, as well as the approach to breed unique tomato seeds that have a stronger resistance to climate challenges and are water efficient."

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