Following on the heels of news of increasing petrol prices, prices of coffee and other household pantry staple products, such as baked beans and dried spaghetti, are also reported to be on the rise.

Now, it seems like inflation may be impacting our beloved dairy products as well.

Reports are saying that if rising fuel prices continue, there will be a significant ‘knock on’ effect on shipping and transport costs across the country, meaning Australian consumers may soon have to pay $1.95 just for a litre of milk, instead of the current going rate at Coles & Woolies of $1.35.

Shoppers may soon pay $4 for a standard, two-litre bottle of cow's milk. Credit: MEGA.
​

Saxo Bank Australian market strategist Jessica Amir said a surge in crude oil prices would increase the prices of everyday supermarket items, such as milk, cheese, and butter.

As petrol and transport costs increase, companies may have to “pass on” these higher prices to their consumers just to make a profit.

“It's probably not out of the question,” Ms Amir told Daily Mail Australia.

“That will absolutely impact everything that consumers buy on a daily and weekly basis – from milk to the cost of eggs to the cost of chicken.”

Aside from the rising petrol prices, Rabobank dairy analyst Michael Harvey also links the milk price increase to the rising prices of fertiliser and stock feed.

“There's no doubt when you get high energy markets and you get high oil prices, that does flow through into high food prices,” he said.

“The cost of producing food can go up, the cost of distributing food can go up.”

He added that more retail products, not just coffee and dairy, are on the brink of a price increase. “There is potential that we're going to see further price increases at the retail end, not just on milk.”

The price of milk as a global commodity has increased significantly over the last 12 months. Credit: tradingeconomics.com.
​

Even before the Russia-Ukraine conflict, experts could already see global dairy commodity prices soaring due to staff shortages and a supply shortfall.

René Dedoncker, managing director at Fonterra Australia, said the pandemic had disrupted several dairy companies’ milk production. The staffing shortages caused buying limits at the supermarket.

“We also continue to see the impacts of the global supply chain disruption on our business with no immediate end in sight, and more recently the domestic supply chain has been severely impacted by COVID,” he said.

Non-dairy alternatives, such as almond milk and soy milk, have also been hit by price increases, caused in part by a drought in California (one of the world’s largest suppliers) and a subsequent global supply shortage.

Looks like we’re heading into some rough weeks, folks. Have you noticed much of an uptick in your grocery costs yet? Let us know below.

 

[Ricci]

I read this article yesterday and was feeling pretty punch drunk after all the doom and gloom from price increases. Well, we all know where our pension increase is going. I think if prices go up much more I might just ask Centrelink to pay my pension directly to Woolies and cut out the middle man!!

 

[MickB58]

Milk prices could SURGE, following other major price hikes in the country​

Following on the heels of news of increasing petrol prices, prices of coffee and other household pantry staple products, such as baked beans and dried spaghetti, are also reported to be on the rise.

Now, it seems like inflation may be impacting our beloved dairy products as well.

Reports are saying that if rising fuel prices continue, there will be a significant ‘knock on’ effect on shipping and transport costs across the country, meaning Australian consumers may soon have to pay $1.95 just for a litre of milk, instead of the current going rate at Coles & Woolies of $1.35.

Shoppers may soon pay $4 for a standard, two-litre bottle of cow's milk. Credit: MEGA.
​

Saxo Bank Australian market strategist Jessica Amir said a surge in crude oil prices would increase the prices of everyday supermarket items, such as milk, cheese, and butter.

As petrol and transport costs increase, companies may have to “pass on” these higher prices to their consumers just to make a profit.

“It's probably not out of the question,” Ms Amir told Daily Mail Australia.

“That will absolutely impact everything that consumers buy on a daily and weekly basis – from milk to the cost of eggs to the cost of chicken.”

​

Aside from the rising petrol prices, Rabobank dairy analyst Michael Harvey also links the milk price increase to the rising prices of fertiliser and stock feed.

“There's no doubt when you get high energy markets and you get high oil prices, that does flow through into high food prices,” he said.

“The cost of producing food can go up, the cost of distributing food can go up.”

He added that more retail products, not just coffee and dairy, are on the brink of a price increase. “There is potential that we're going to see further price increases at the retail end, not just on milk.”

The price of milk as a global commodity has increased significantly over the last 12 months. Credit: tradingeconomics.com.
​

Even before the Russia-Ukraine conflict, experts could already see global dairy commodity prices soaring due to staff shortages and a supply shortfall.

René Dedoncker, managing director at Fonterra Australia, said the pandemic had disrupted several dairy companies’ milk production. The staffing shortages caused buying limits at the supermarket.

“We also continue to see the impacts of the global supply chain disruption on our business with no immediate end in sight, and more recently the domestic supply chain has been severely impacted by COVID,” he said.

​

Non-dairy alternatives, such as almond milk and soy milk, have also been hit by price increases, caused in part by a drought in California (one of the world’s largest suppliers) and a subsequent global supply shortage.

Looks like we’re heading into some rough weeks, folks. Have you noticed much of an uptick in your grocery costs yet? Let us know below.

Be nice if we had a guarantee that prices will go back down once fuel prices drop. Fair go for everyone not just greed and profits. Same for all products in any stores country wide