Alongside our daily news coverage, features and interviews, the Just Food team sifts through the week’s most intriguing data sets to bring you a round-up of the week in numbers.
This week, we saw Campbell Soup Co. report another quarter of falling volumes, heard how Grupo Bimbo might be ready to make another acquisition in Romania’s bakery market and reported on another month when sugar prices rose.
Another volume decline but Campbell sees consumer confidence improving
On Wednesday (6 March), Campbell Soup Co. booked another quarterly decline in its “volume-mix” but said it is expecting volumes to improve this year as consumer confidence brightens.
The US food major also expects to see a benefit from its $2.7bn acquisition of Rao’s sauces maker Sovos Brands, a deal which has been held up by an antitrust review but which is expected to be completed next week.
The Campbell chief also indicated the company’s volume numbers would improve year on year as it lapped more significant declines from the previous fiscal year.
“This is not some massive hockey stick, right?,” he said. “It’s a pretty steady drumbeat of more modest improvement as we go through the back half of the year. We are lapping in the first half of the year, [sales] growth rates that were closer to 13%, 14%. And, in the back half, we’re going to be lapping 5%.
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“On volume, just to give you a little bit of that delta, in the first half of ‘23, we were cycling about 1.5% of vol-mix decline. We move into the back half, we’re going to be lapping about a 6% vol-mix decline, so both on the net sales and the vol-mix, the comps are going to get significantly easier.”
On consumer confidence, Clouse said: “We are also continuing to see economic pressure impacting select categories and certain consumer demographics. While we expect these trends to improve over time, we’re certainly not there yet.”
However, he added: “Consumer sentiments improving, household penetration in many of the categories have kind of turned the corner. We’re seeing improvement, albeit still fewer trips to the supermarket, we’re seeing a little bit of a step back up in the number of categories purchased, the number of servings purchased. All of those, to me, provide pretty compelling evidence that we will see the turn.”
Sugar strikes sour note in FAO food price index update
In the latest update to the FAO food price index, the UN agency reported today that global food commodity prices continued to fall in February and marked the lowest average since February 2021, mainly as a result of lower world cereal prices.
The FAO Food Price Index, which tracks the prices of five food commodities, fell 10.5% from the same month last year and was down from 118.2 points in January. The gauge, compiled by the Food and Agriculture Organization of the United Nations, averaged 117.3 points in February.
The cereal price index fell 5% from January to 113.8 points, down 22.4% from its value in February 2023. The FAO said that international prices of all major cereals declined month on month, with maize exports falling the most.
The FAO’s indices for meat and sugar, however, ticked up.
Sugar prices were up 12.5% on the previous year and 3.2% on the month prior, marking the second consecutive monthly rise.
“Persistent concerns over the outlook for the upcoming season in Brazil following a prolonged period of below-average rainfall continued to support world sugar prices, exacerbating the seasonal upward pressure. Furthermore, forecasts pointing to likely production declines in Thailand and India, two leading exporting countries, contributed to the price increase,” the FAO wrote.
Bimbo rumoured to be ready to strike again in Romania
This week also saw Grupo Bimbo, the world’s largest bakery business, linked to another acquisition in Romania.
According to local financial news outlets, Bimbo is set to scoop up six more bakeries in the country.
The Mexican group is said to be set to secure the new sites in a deal worth €100m ($108.9m).
When contacted by Just Food, Grupo Bimbo Romania’s managing director, Ionut Ilie, declined to offer further information on the reported move.
The bread and baked goods factories are being bought from the family of local entrepreneur Siminel Andrei, according to unnamed “sources in the market” cited by Ziarul Financiar.
Last year, Grupo Bimbo bought Romanian bakery business, Vel Pitar, from New York-based private-equity fund NCH Investment, where Andrei is vice president.
