Thursday 2 June 2022 01:46 AM Coles issues an urgent warning to Australian shoppers trends now Coles boss Steve Cain has revealed supermarkets are being forced to rapidly jack up their prices as food suppliers struggling with production costs demand fee rises. Over the past 12 months, Mr Cain has witnessed a drastic increase in the number of suppliers knocking on his door to discuss pricing. 'As I sit here today, we have got five times as many requests for price increases as we had last year. Five times,' Mr Cain said, speaking at The Australian's Global Food Forum on Wednesday. 'And they’re not small amounts. It’s not 2 per cent or 3 per cent being asked for either so there is, you know, the usual "pig in the python" trying to work its way through the system, whether things plateau or whether they come down slowly remains to be seen.' Mr Cain's comments reveal the supermarket industry's difficult balancing act between maintaining the economic sustainability of suppliers, providing affordable food to shoppers and maintaining a profit margin for shareholders. But as the Russian-Ukraine War and Covid pandemic hamper global supply chains and crops remain scarce due to the NSW-Queensland floods, food producers are facing increased fees. Shoppers have been facing increased prices at supermarket checkouts amid skyrocketing inflation Woolworths boss Brad Banducci earlier this year also revealed the company had already seen price boosts of 2 to 3 per cent, with more supplier fee increases expected soon. As fresh produce prices outstrip dry and packaged consumables, Mr Cain predicts budget-conscious shoppers will be forced to live off traditionally cheaper canned or frozen food. He also foreshadowed that Aussies will stop eating out at restaurants in favour of cooking at home, with sales of long-lasting food items set to lift. While the floods in northern NSW and southern Queensland have ravaged many vegetable and fruit farms, Mr Cain said lettuce and truss tomatoes were particularly difficult to get. In contrast, he said bananas and grapes are in more plentiful supply and the prices are down compared with last year. Mr Cain said his industry was also struggling with labour shortages as employees take higher paying roles elsewhere and Covid-19 and the flu thins staff rosters, with Coles workers taking leave at double the normal rate. However, he said the labour crisis was not responsible for the currently high prices, but the knock-on effects would 'flow through the system' and become apparent 'over the next 12 months'. Coles CEO Steve Cain (pictured) said supermarkets are being forced to rise prices as suppliers call for cost increases However, Mr Cain said there was some good news for consumers, with prices across the meat industry set to soften and frozen food stocks back up after being depleted amid the pandemic. The dire warning comes after the nation’s peak body for food and grocery manufacturers announced costs have increased 700 per cent since the pandemic, which would partially be passed on to customers. 'It has now gotten to a point where the level of costs coming through now are just astronomical and businesses really are not able to contain that themselves anymore and are in negotiations with retailers to pass some of that through,' Australian Food and Grocery Council chief executive Tanya Barden said. On Wednesday, Treasurer Jim Chalmers warned inflation was set to skyrocket in coming months, with the Reserve Bank of Australia expected to inflict five more interest rate increases before the end of 2022 in a bid to slow prices. Mr Cain predicts shoppers will opt for frozen and canned food as fresh food prices go up The March quarter national accounts showed the economy grew by 0.8 per cent, a marked slowdown from the upwardly revised 3.6 per cent increase in the December quarter when the Delta variant lockdowns ended. A cost of living relief package that goes beyond the current measures will be unveiled in Labor's first budget in October. Reductions to the fuel excise, tax cuts and welfare prop ups unveiled in the last coalition budget in March are all due to end in the coming months. Mr Chalmers says the new government is being upfront with people about the cost of living crisis, as he continues discussions with cabinet ministers and the energy sector about how to respond to increasing energy costs. 'Our job as the new government, and my job in the October budget, will be to bring down a cost of living package that encompasses areas like child care, like cheaper medicines, like our efforts to get power bills down,' he told the Nine Network on Thursday. Mr Chalmers says it would be hard to find the billions of dollars to continue cuts to the fuel excise, and would not commit to pulling the government's gas trigger - enacting the Australian Domestic Gas Reservation Mechanism - to shore up domestic supply. German discount Aldi estimates a typical family spends $192.19 a week or $9,994 a year on groceries 'I don't want to pre-empt any of those kinds of discussions,' he said on a decision to use the mechanism. 'It has its own challenges and it is not immediate. There is a series of processes that we would need to go through. 'We need to be upfront and recognise that there is not one thing that we can do to fix this overnight.' Pulling the trigger could upset partners reliant on cheaper Australian gas, as prices in the international market spike due to a reliance on Russian supplies, with many long-term contracts locked in at cheaper rates. 'That is one of the challenges that the government and others would have to grapple with if we went down that path,' Mr Chalmers told Sky News. 'I'm not suggesting ... we will go down that path. I'm saying that that's part of the discussions and deliberations that need to happen now.' How millions of Aussie families will be AT LEAST $670 a month worse off in just six months - after chilling admission Australia's economic outlook is DIRE By Stephen Johnson, economics reporter for Daily Mail Australia A typical Australian family is set to be $670 a month worse off by Christmas as interest rates and grocery costs rise alongside a doubling of petrol taxes and electricity bills. How YOUR bills in December would compared with now MORTGAGE: Borrower with a $600,000 mortgage would see their monthly repayments rise by $460 to $2,844 as interest rates rose five more times PETROL: A doubling of fuel excise back to 44.2 cents a litre would see a bill to fill up a Toyota RAV4 rise by $48.60 a month ELECTRICITY: A doubling of power bills meaning $118.67 more a month as a doubling of wholesale power costs are passed on to consumers GROCERIES: A family shopping at Aldi would see their monthly grocery bill rise by $42.47 should inflation stay at 5.1 per cent Advertisement New Treasurer Jim Chalmers is warning of 'skyrocketing inflation' with the Reserve Bank of Australia widely expected to inflict five more interest rate increases before the end of 2022 in an attempt to put the brakes on price rises. 'This perfect storm of energy price spikes is doing enormous damage to our employers, to our households, and to our national economy,' he said. The incoming Labor government wants Australia's lowest-paid workers to be given a 5.1 per cent pay rise in line with the consumer price index. This would see 2.7 million minimum and award-wage employees receive the biggest pay increase since 2006 at the height of the mining boom. However adding extra labour costs to businesses still dented by the Covid lockdowns will inevitably see that impost passed on to end consumers, pushing the prices of goods and services even higher. Mortgages Home borrowers with an average $600,000 mortgage last month saw their mortgage repayments climb by $78 after the RBA raised the cash rate for the first time since November 2010. This typical borrower would now owe their bank $2,384 a month, on a 2.54 per cent variable rate. But should interest rates rise five more times by Christmas - which is widely tipped by economists - those repayments would rise by $460 to $2,844 as variable rates climbed to 3.94 per cent. Westpac, Australia's second biggest bank, is expecting the RBA to raise rates five more times this year, starting with a bigger 0.4 percentage point increase in June. New Treasurer Jim Chalmers is warning of 'skyrocketing inflation' with the Reserve Bank of Australia widely expected to inflict five more increases before the end of 2022 The bank's chief economist Bill Evans is expecting 0.25 percentage point increases also in July, August, October and November. Australia's economy grew by 3.3 per cent in the year to March, with the official national accounts data showing a 0.8 per cent increase over three months. 'From the Reserve Bank's point of view, these accounts will reinforce the case for further interest rate rises,' Mr Evans said. 'The Bank may see some encouraging evidence in the accounts around wages growth but will be more focused on the clear inflationary pressures now flowing through the economy. 'Inflation pressures were evident in the price measures.' Last month, the RBA raised the cash rate by 0.25 percentage points, from a record-low of 0.1 per cent, to 0.35 per cent with the big banks all passing on the increase in full. What YOU could be paying by Christmas $500,000: Monthly repayments rising by $383 from $1,987 to $2,370 $600,000: Monthly repayments rising by $460 from $2,384 to $2,844 $700,000: Monthly repayments rising by $537 from $2,781 to $3,318 $800,000: Monthly repayments rising by $614 from $3,178 to $3,792 $900,000: Monthly repayments rising by $691 from $3,575 to $4,266 $1,000,000: Monthly repayments rising by $767 from $3,973 to $4,740 Data based on variable rate rising from 2.54 per cent to 3.94 per cent as the Reserve Bank of Australia raised the cash rate from 0.35 per cent to 1.75 per cent Advertisement All rights reserved for this news site (dailymail) and under his responsibility