Woolworths and Coles quietly jack up meat prices

JUST two months after boasting about making these “iconic” products more affordable, Woolworths has quietly jacked up prices on some the most popular items.

Woolworths CEO Brad Banducci. Picture: Aaron Francis/The Australian

JUST two months after boasting about “making iconic Aussie meat cuts more affordable”, Woolworths has quietly jacked up its meat prices by up to 10 per cent.

The supermarket, which has invested about $1 billion since 2015 on lowering prices to match Coles, this week broke ranks to quietly increase prices on key meat lines including steaks and mince.

Porterhouse steaks has risen from $30 to $32 while scotch fillets have increased from $30 to $33 per kg, rump steak is up $1 to $21, eye fillet is up $1 to $43 and T-bone prices have increased $1 to $22. “Heart smart” mince has increased $1 a kilogram to $16 a kilo.

However, Coles has also recently raised prices on its lamb cutlets from $28 a kilo to $32 and forequarter chops from $10 a kilo to $13, ending a discount war to bring its prices in line with Woolworths.

The price moves comes after a warning from Woolworths chief executive Brad Banducci warned that spiralling energy costs were like “trying to outrun a bear” and that consumers would soon be paying more for groceries as a result.

Speaking at the Visy Global Food Forum in Melbourne on Tuesday, Mr Banducci said cost increases would outweigh savings from energy-efficient lighting and refrigeration.

“We manage what we can manage with energy efficiency,” he was reported in The Australian as saying. “But given the cost increases that are coming through right now, we are trying to outrun a bear, but I am not sure we can. We will have to, in some way, very cautiously and carefully, pass those through to our customers, unfortunately.’’

At the retailer’s half-year results briefing last month, Mr Banducci said Woolworths was “in a good place on our actual prices” but still had “quite a bit of work to do on price perception”.

“One of the things we’ve always battled with at Woolworths is how we communicate price,” Mr Banducci told analysts. “We need to keep vigilant on price and improve communication of price but we have a lot of work to do with the in-store experience.”

Mr Banducci said the “traditional red meat business is incredibly challenged in Australia”, with overall costs for beef and lamb increasing by $40 million in the first half, “a lot of which” the supermarket didn’t pass on to customers.

In January, Woolworths announced it was dropping “iconic steak, burger and sausage lines” to its “price-dropped range”. Woolworths has been contacted for comment on this week’s meat price increases.

A Coles spokesman said: “Coles has been minimising the impact of wholesale meat cost increases on shelf prices because we are committed to reducing the average cost of our customers’ shopping baskets, as we have been doing every year since 2008.”

A Woolworths spokesperson said: “Woolworths is committed to providing customers access to high quality fresh meat at great value across the entire fresh meat range.

“On everyday Aussie staples such as mince and sausages customers are able to take advantage of great offers in the meat department and across the store. On some lines we’ve made price adjustments due to rising costs for meat. We continue to work hard alongside our suppliers to ensure we are minimising any impact to customers.

“We remain committed to investing in price and continuing to provide our customers with low prices both in store and online.”

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