Media: mayonnaise producers plan to raise prices

Major mayonnaise producers are going to index prices by 5-12%. The planned rise in price is associated with an increase in the cost of the main ingredients. About it informed “Kommersant” with reference to information from manufacturers. At the same time, analysts believe that a rise in price by 10% will not affect demand.

According to the interlocutors of the publication, Essen Production AG, the manufacturer of sauces under the Maheev brand, informed retailers about a 5-10% increase in prices for mayonnaise and some other sauces from August 21. The prices for products for restaurants will also be indexed by 8-10%, including portioned sauces in a package of 10 g. An increase in selling prices by 10% was reported by GC “Efko” (“Sloboda”), by 12% – NMGK (” Ryaba, Astoria).

The five companies that account for three quarters of mayonnaise sales in Russia are Essen Production AG, Efko, NMGK, GKRusagro“(” Moscow Provence “,” Mechta hostess “) and GC” Nefis “(Mr. Ricco) – did not provide comments on these messages.

The prime cost of mayonnaise is 60% sunflower oil, another 20-25% is chicken eggs and packaging, according to OleoScope analytical agency. During the first week of August, the average prices for sunflower oil increased by 2,850 rubles. up to 79 020 rub. per ton including VAT, while export quotations increased by $30 to $940 per ton (FOB). Sunflower rose by an average of 1,500 rubles. – up to 27,850 rubles. per ton. A year ago, oil cost an average of 73,600 rubles. per ton, sunflower – 25,700 rubles. per ton.

Andrey Sizov, director of Sovecon, believes that the increase in the cost of mayonnaise may be associated with an increase in the cost of packaging and other materials for production, which depend on exchange rates and logistics. “Prices for sunflower oil in Russia remain stable,” Dmitry Rylko, director general of the Institute for Agricultural Market Studies, confirmed.

In 2022, the prices for the main oil and fat products were growing due to the acceleration of inflation, the reduction of promo and the increase in prices for vegetable oil, according to the report “Rusagro“. Selling prices for mayonnaise for 2022 increased by an average of 21%, to 117.7 rubles. per 1 kg without VAT. In 2022, the production of mayonnaise and sauces based on it decreased by 4%, to 817,000 tons, imports – by 49%, to 3,000 tons. In 2018–2021 production remained in the range of 828,000 – 860,000 tons.

For the first half of 2023, sales of mayonnaise decreased by 2.1%, other sauces – by 2.5%, according to NielsenIQ. In money terms, sales increased by 0.1% and 10.2%, respectively. Price increases within 10% on the demand for mayonnaise “is unlikely to affect.” Mayonnaise has no alternatives, like margarine for butter, for example, OleoScope analyst Kirill Lozovoy said.

The interlocutor of “Kommersant” in the market believes that “inflation will remain the main problem for market participants and regulators for the next few months”, a repeat of the situation in 2014 is likely, when food prices grew at a double-digit pace. Manufacturers and suppliers have already notified retail chains about the increase in selling prices for soft drinks and juices, meat products, tea, coffee and sweets. Zeroing duties on the import of raw materials, solving problems with the growth of transportation tariffs, including a shortage of drivers, and other measures could curb the rise in prices.

On June 27, Kommersant reported that the GC “Rusagro» agreed to buy control in the Nizhny Novgorod Oil and Fat Plant (NMGK Group), which produces Ryaba mayonnaise and Astoria sauces. The deal, which I plan to complete by the end of 2023, will allow the two companies to obtain synergy in the fat and oil market, as well as enter new categories and markets.