EXCLUSIVE: New study suggests that panic buyers could be the culprit for the permanent price hike in groceries
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Grocery shopping was chaotic back in March 2020 as panic buyers rushed into grocery stores to stock up on home supplies after the government announced the guidelines for lockdown protocols to contain the spread of COVID-19 in the country.

However, did you know that aside from the hassle experienced by those who ran out of toilet paper or had nothing to eat other than a couple of cans of baked beans (if you were lucky), panic buyers also caused permanent price hikes in grocery stores?

A study by Deakin University’s Institute for Health Transformation suggests that panic buying might have caused the permanent price rise of food staples in grocery stores. Credit: Mireille Merlet.​

A new study revealed that panic buying jacked-up grocery prices permanently, 18 months after Aussies wreaked havoc in grocery stores.

The unreleased data from Deakin University’s Institute for Health Transformation suggests that prices of food staples are on the rise, following their analysis of about 7,000 Coles and Woolworths products over the last three years.

Prices of the most common household purchases went up by around 2 to 7 per cent, while in some extreme cases they were as high as 37 per cent.

“These are not normal prices. We account for the consumer price index (but these) price changes are over and above inflation," said Lead researcher and Deakin University Associate Professor Kathryn Backholer.

Aside from panic buying, researchers also suggest that labour shortages, supply chain issues, and COVID-19 safety protocols — which could have disrupted logistics — could be the culprits for the permanent price hike.

The researchers revealed that since the pandemic started back in March, prices of fresh fruit went up by 7 per cent, oils went up by 4 per cent, long-life milk and legumes rose by 3 per cent, and fresh milk and eggs rose by 2 per cent.

In a more extreme individual case, dried pasta jumped by 15 per cent, with one brand increasing by a whopping 37 per cent from its original price back in February last year.

Additionally, prices of butter surged from $3.80 to $4.30, an increase of 13 per cent, while sultanas now retail at $8.40, a 12 per cent increase from their original price of $7.50.

Professor Backholder said: “We looked at the price increase during that first wave (of Covid). It was a four-month period across most states and territories, we saw prices go up during that period.”

“We looked at what happened during that period of relative stability afterwards."

“They (prices) didn’t come back down.”

Panic-stricken shoppers rushed to grocery stores after the government announced quarantine protocols to contain the spread of COVID-19 in the country. Credit: NCA NewsWire/Tertius Pickard.​

Panic buying is not the sole culprit behind the price hikes, however, as international and interstate closures have led to supply chain issues and labour shortages — translating to operational issues for supermarkets which are struggling for manpower at all levels of operation, from producing food, delivering it, and stacking shelves.

Professor Backholer said that the price hike was a 'double whammy' for Australians as the cost of living in the country rapidly increased while wages are not growing at the same rate.

“For me, it highlights the vulnerability of our food system to shocks more broadly,” she said.

“This time around it was Covid-19. We’re only going to see more shocks in the future with climate change and extreme weather events that disrupt the food chain.”

The associate professor suggested that one way to stop these "volatile prices" is to diversify food sources.

“For coffee, we rely on one, maybe two regions in the world. We should consider growing and producing certain products locally and give support to our farmers,” she added.

The research report is expected to be released early next year.

Australian Prime Minister Scott Morrison described panic buyers as ‘un-Australian’ back in March 2020. Credit: Mireille Merlet.​

It must be noted that Prime Minister Scott Morrison condemned panic buyers for being "un-Australian" in March last year.

“It is not sensible, it is not helpful and it has been one of the most disappointing things I have seen in Australian behaviour in response to this crisis,” he said at the time.

Meanwhile, Western Australian Premier Mark McGowan did not mince his words with his comments regarding panic buyers, calling them "jerks, drongos and bloody idiots”.

“I’d urge them to stop, have respect for each other, stop this panic buying, this violence, this stupidity going on,” he said in March 2020.

 

[terri]

I understand that in this day of constant price increases, that this may happen. But covid seems a great excuse to do what ever to prices and justify doing so. I wonder how far they can push us before we feel like pushing back. People can show their dissatisfaction at the checkout, and not verbally at the operator, but by their spending.

 

[Xe]

That's the thing about price hikes. They always go up but they never ever come back down

 

[Hel]

That's the thing about price hikes. They always go up but they never ever come back down

Remember bananas? 79c a kilo before a cyclone, never under $2,50 since, and sometimes up to $7. Trees grow back! That's just price gouging, same as this!

 

[Singomate]

Here we go again,I thought the spin finished with the election. The only reason for price rise, pure and simple greed. A real politician, who passed not long ago said once the big corporations took over the Supermarkets, Service Stations, Hardware stores we would be at their mercy and yes we are.
Electricity goes up excuse we need to pay for maintenance, so they run the system down and we must pay, while they rake in the profit for bad management please spare me the bulls. T

 

[Xe]

Remember bananas? 79c a kilo before a cyclone, never under $2,50 since, and sometimes up to $7. Trees grow back! That's just price gouging, same as this!

There are a lot of other factors to consider, like harvesting, the labour involved, the costs of distribution etc. The prices of all of these things go up even though a banana tree is a banana tree. It's just that they go up by way too much.