A Guardian analysis uncovers how companies enriched themselves and their investors while boasting about jacking up prices
Similarly, a Kroger executive told investors in June, “a little bit of inflation is always good for our business”, while Hostess’s CEO in March said rising prices across the economy “helps” it profit.
The data is not intended to be definitive, but does show how a wide sample of companies have raised prices even as profits jumped. In earnings call after earnings call, executives made no secret of their strategies. Fertilizer giant Nutrien’s profits shot up by about $1.2bn on “higher selling prices [that] more than offset higher raw material costs and lower sales volume”.
The analysis found commodity companies trading in oil, timber, rubber, meat, wheat, steel and mining recorded the highest profit increases, while restaurants and retailers saw comparatively lower improvements, or losses. Commodity price spikes reverberate down the supply chain, eventually hitting consumers, noted Martin Schmalz, an Oxford University economist.
“This isn’t price gouging … and it shows pretty concretely that there’s a lot of nuance here,” Pearkes said, adding profiteering is “not the primary driver of inflation, nor the primary driver of corporate profits”. However, he added that it’s reasonable to question whether Caterpillar should have passed on its cost increases.
In recent months, the white-hot market for newly built houses shut out many Americans as average sale prices$500,000. The popular explanation: inflation, supply chain squeezes and building material costs.
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