By Emma Koehn
Vitamin supplements prices are rising and could spike further due to inflation and higher costs for key ingredients such as fish oil.
Production costs increased in the sector over the past year, and raw ingredient prices have also jumped, including almost a two-fold rise in the price of fish oil exported from South America since 2020.
Blackmores CEO Alastair Symington said raw material prices were continuing to increase. Credit:
Alastair Symington, chief executive of major vitamin supplements maker Blackmores, said the price of raw materials for its products had risen between 15 and 20 per cent over the past six months.
A spike in costs prompted the ASX-listed company to increase prices across some of its products over the past six months, particularly products that relate to eye care, immunity and energy.
Prices increased between 5 per cent and 6 per cent in Australia and New Zealand, and between 7 per cent and 8 per cent in international markets.
Symington said the company would consider further increases in coming months because of continued inflationary pressures.
“It’s something that we’re looking at ... but it is not something that we would take unilaterally across our range, it would be selective,” he said.
He said some products could see additional price increases of more than 5 per cent if materials prices remained elevated. While global supply chains were stabilising, commonly used ingredients like fish oil have spiked in price over the past year, putting pressure on supplement makers.
“In the last six months, raw material commodity prices [have seen a] 15-20 per cent increase,” Symington said.
“We haven’t put through price rises that 100 per cent cover all of that.”
Blackmores is not alone in warning on increased costs for the consumer. Several other ASX-listed companies told investors this month that prices on a wide range of products, from dairy goods to kitchen appliances, had gone up to offset inflation.
Cheesemaker Bega said last week that it was confident the days of steep dairy price increases had come to an end – but flagged that more price increases in line with “normal inflationary pressures” would be seen this year.
Major supermarkets Coles and Woolworths were also optimistic that overall grocery price inflation would moderate this year, but both confirmed price growth had accelerated faster in the December quarter than in the three months to September last year.
Other consumer goods brands also flagged price increases in the six months to December: coffee machine maker Breville reported that it pushed through “specific price increases” on certain products, while discount retailer The Reject Shop said it was left with no choice but to raise selling prices in a “targeted way”.
Analysts expect inflationary pressures to moderate later this year, but some predict further price jumps, particularly in food.
“Channel checks with suppliers, assessment of global fast-moving consumer goods (FMCG) outlook statements and analysis of soft commodity prices point to significant food inflation over the coming two to three years,” Barrenjoey consumer analyst Tom Kierath said in a note to clients last week.
The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.