Following the news that brands in the UK are turning to rapeseed oil to cover sunflower oil shortages;

Alice Popple, Consumer Analyst at GlobalData, a leading data and analytics company, offers her view:

“The lack of availability of sunflower oil is especially worrying for savory snack brands who depend on this ingredient, as changing to other ingredients will lead to higher price points, both from a business and a consumer perspective. GlobalData’s survey found that 29%* of UK consumers deem good value for money in savory snacks to be low prices, suggesting that price increases will be concerning for the category.

“The rising prices of alternative raw ingredients, such as rapeseed oil, is expected to have a continuous detrimental impact on consumer behavior due to financial constraints and other mitigating macroeconomic factors such as GDP as brands offload costs onto consumers.

“According to GlobalData’s latest Russia-Ukraine poll results, almost one in five (18%)** Brits are concerned about the rising cost of day-to-day groceries due to the Russia-Ukraine conflict. Underscoring this, GlobalData’s March 2022 survey found that 53%*** are still worried about their financial situation. Brands reformulating with alternative ingredients must consider price sensitivity if they want to keep customers happy – raise them too high and it may push people to seek alternative products or brands.

“However, it needs to be noted that these changes won’t impact every consumer, as 26%* of Brits agree that, so far, their shopping has been unaffected by the current conflict in Ukraine. However, the future is uncertain, and prices are set to rise in the long-term. Brands must acknowledge the impact higher prices will have on grocery staples, both as a show of goodwill and for long-term sustainability. Understanding how resource shortages and inflation as well as geopolitical uncertainty will continue to cause a strain on operations will be key to establishing a robust future strategy that can safeguard against the turbulences being seen in global trade.”

* GlobalData 2022 Q1 UK Consumer Survey

** GlobalData’s 2022 Ukraine/Russia Polls – UK

*** GlobalData 2022 Q1 UK Consumer Survey; combined responses: “Extremely” and “Quite” concerned; approximately 500 respondent sample size

For more information about how the Russia-Ukraine crisis is affecting industries, download GlobalData’s Ukraine Conflict: Executive Briefing.