Unilever ramps up pricing to offset higher commodity costs

Improved visibility over supply of key inputs gave the CPG clarity to implement hikes after keeping prices flat during the first half of the year.

Consumer-packaged goods manufacturers have been battling surging commodity costs and economic volatility fueled by the Iran war and persistent inflation for much of this year.

Historically high costs for vegetable and palm oils have been some of the key commodities squeezing Unilever’s wallet, according to Phatak. The company also pointed to kerosene prices, logistics costs and foreign exchange rates as factors in hiking commodity spending.

Despite this, the company says supplies are normalizing, giving it better visibility on crude oil and other commodity inventories. That certainty allowed it to make an informed decision about pricing in Q3 after keeping prices relatively flat in the first half of the year, per CEO Fernando Fernandez.

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