Exposes Need for Recent Supply Chain Policies and Further Federal Action

ARLINGTON, Va. — The Consumer Brands Association cautioned that wholesale prices in today’s Bureau of Labor Statistics readout demonstrated ongoing production cost pressures for the consumer products industry. The December Producer Price Index for food manufacturing increased 10.8% year over year, despite a slight decline of 0.8% since November 2022.

Overall, final demand increased 6.2% in 2022 after rising 10.0 percent in 2021. Along with sky-high consumer demand, the industry continues to contend with commodity prices that remain above pre-pandemic levels, despite slight easing after a spike last summer. Food manufacturing input costs are up 18% over November 2021.

“As the consumer products industry faces steep input prices and high demand, I’m glad that important federal provisions supported by Consumer Brands were recently signed into law fund dedicated supply chain workstreams. This was a key step to adding resiliency to the supply chain and complementing private sector efforts to ensure consumer have access to the essential items they rely on,” said Tom Madrecki, Vice President of Supply Chain.

“Consumer Brands will actively monitor the work of the Department of Transportation’s new Multi-Modal Freight Office and newly funded federal efforts to analyze supply chain data, as we continue to push for a federal overhaul of America’s supply chain policies, including efforts to tackle harmful trade barriers that are hurting consumers and companies and are a contributor to rising costs.”

This week Consumer Brands submitted comments to the Office of the United States Trade Representative (USTR) for consideration in its review of the impact of certain tariffs that are contributing to input price costs.

“We suggest that tariffs enacted on imports be targeted and aligned to key objectives rather than scattershot, and recommended the adoption of processes enabling food, beverage and consumer product manufacturers and their suppliers to seek exclusions on packaging and ingredient materials with no national security application,” said Madrecki.

Key input commodities show wholesale prices that remain above last year and pre-pandemic norms. Year-over-year, eggs are up 192%, processed turkeys increased 36%, and edible oils rose 13%. Additionally, diesel fuel is up 20% year-over-year, significantly impacting the CPG industry, which accounts for one-fifth of all freight transportation.

“We’ve made major strides to bolster America’s supply chains since the pandemic exposed their fragility. We hope to harness recent momentum to move the additional policies we need to enhance federal supply chain management and oversight, strengthen transportation operations and the manufacturing workforce and support new technologies,” Madrecki said.

“These efforts will ultimately enhance supply chain performance, protect national security, expand job creation and worker availability, grow the economy, eliminate trade barriers and accelerate innovation.”

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The Consumer Brands Association champions the industry whose products Americans depend on every day, representing nearly 2,000 iconic brands. From household and personal care to food and beverage products, the consumer packaged goods industry plays a vital role in powering the U.S. economy, contributing $2 trillion to U.S. GDP and supporting more than 20 million American jobs.