Nestle (OTC:NSRGF, VTX:NESN) and Danone (OTCQX:DANOY) have both signalled food prices could climb more slowly over the coming year after big hikes hit demand at both companies.
"Pricing will be a lot lower this year than last year," Nestle chief executive Mark Schneider said on Thursday after the KitKat and Nespresso owner’s results.
"Growth going forward [...] is going to be a lot more volume and mix-based," he added, suggesting this should be “pretty universal”.
Nestle reported organic sales growth of 7.2% for the year to December, below analysts’ expectations of 7.4%.
Danone said like-for-like sales had climbed by 7% meanwhile, with price increases offsetting a 0.4% decline in volumes.
Price rises have become commonplace in shops in recent years, with the two food giants hitting consumers with hikes on the back of soaring costs due to the pandemic and war in Ukraine.
Shoppers are now searching around for cheaper alternatives, said both companies, echoing rival Unilever PLC (LSE:ULVR) in signalling a shift in focus to volumes.
Unilever, another consumer goods giant, pointed towards easing price rises on the back of subsiding inflation in its results earlier this month.
Danone (OTCQX:DANOY) boss Antoine de Saint-Affrique also acknowledged easing inflationary pressure but warned price hikes were by no means set to go away.
"We are in a world of slowing-down inflation,” he said, warning that there could still be future “volatility”.
He added: “We expect to have a price component in our growth, it will differ by region.”