New Frugl grocery price index reveals big increases in pantry staples and cleaning products

Much attention has been given to the rapid increase in the cost of lettuce, but a new index of hundreds of popular supermarket items reveals the must-buy items that have shot up in price and can’t be substituted.

The price of groceries you have little choice but to buy – pantry staples and cleaning products – have surged by more than 13 per cent since last year.

While much attention has been given to rapid increases in the cost of meat, fruit and vegetables, a new index of hundreds of popular supermarket purchases reveals that the real budget killers are items like laundry powder and olive oil, which can be harder to substitute than beef or lettuce.

The average price of cleaning products rose by 13.7 per cent in the year to the end of June, according to research by ASX-listed retail data company Frugl, while the cost of pantry staples soared by 13.2 per cent.

Frugl CEO Sean Smith told The Daily Telegraph that cleaning products such as detergents had a particularly “big impact” on household supermarket spending because they are so expensive, overshadowing many of the movements in the fresh food aisles.

Overall grocery price inflation has reached nearly seven per cent, Frugl found.

Cobram Estate olive oil has shot up in price, Frugl found. Picture: Cobram Estate

“These numbers are big – quite shocking,” Mr Smith said.

Westpac economists this week doubled their year-through-June inflation forecast for food only to 5.4 per cent.

And things could get worse.

Frugl’s Mr Smith said he did not see any chance of a let up this year in pressures from “international macro factors.”

These include the supply crunch caused by China’s zero-tolerance approach to Covid, as well as the war in Ukraine, which is forcing up the price of fuel, wheat, oils and fertiliser.

Mr Smith warned the rate of cost increases would nudge double digits later this year if predictions of further heavy rains in food bowl districts proved accurate.

Shanna and Brett Laffin with daughter Phoenix, 10, are trying to save money with the rising cost of groceries. Picture: Tom Huntley

“The thing that really makes a difference here is the weather,” Mr Smith said.

“And it doesn’t look good. We are bracing ourselves.”

Frugl’s research was produced following consultation with the Australian Bureau of Statistics, which will next week release the consumer price index (CPI) for the year through June.

Westpac’s economists expect the CPI will hit 6.1 per cent, up from 5.1 per cent in the year to the end of March.

The bank’s boffins now forecast the official inflation rate – which covers all goods and services – will reach seven per cent for calendar 2022.

Frugl’s new index: red is the annual change, blue is quarterly. Picture: Frugl

Reserve Bank of Australia governor Philip Lowe has also said he expects inflation to reach that level by Christmas.

Frugl’s Mr Smith said that there were ways to avoid some of the rising costs in supermarket aisles.

“There are pockets of products that are less impacted,” such as bulk packs of chicken thighs, which are “really cheap”.

“And the retailers are … offering ranges of products where they are trying to keep prices down,” Mr Smith said.

The average price of cleaning products rose by 13.7 per cent in the year to the end of June.

“People can make savings if they do their research. That’s really the key.”

Adelaide’s Shanna Laffin travels to Costco, more than 40km from her home, to try to limit the impact on her weekly grocery bill.

“I shop at Woolies and Coles for half price sales, but those prices don’t seem like they’ve lowered across the board,” she said.