Cawston Press has warned global orange juice prices are unlikely to see improvement in the “near to mid-term” as inflationary pressures caused profits to slide at the soft drinks supplier.
In accounts for the year ended 31 December 2023, Cawston Press said it “continued to see material inflation passed on by suppliers across all cost lines within the P&L”.
Costs relating to “raw material, manufacturing and distribution” were particularly high, it noted.
Cawston Press said it had upped prices across its portfolio, but had “sought to balance the impact of price increases on volume growth” and subsequently did not pass on elevated costs in their entirety.
As a result, its operating profits fell by 35.4%, to £192k. Gross profits, meanwhile, slid 59.0% from £205k to £84k, with margins being hit by both material and “exceptional one-off” costs.
Turnover, however, increased 10% to £20.3m, driven by price increases and volume growth across the portfolio.
The supplier added it did not expect a reprieve in raw material costs anytime soon.
The price of not-from-concentrate apple and orange juices was up 25% year on year in 2023, it said, citing the global supply crisis that has blighted orange juice in recent years.
Orange was “unlikely to recover in the near to mid-term” while apple pricing would be “dependent on the next crop”, it noted.
Orange juice prices have been on a tear since the end of 2022, driven by the impact of successive poor harvests in Florida and Brazil.
In May, Brazil – the world’s largest exporter of the commodity – said it expected harvests this year to be down 24.3% on the previous season, owing to poor weather and disease.
Commodity prices have begun to filter through to shelf edges, with own-label orange juice up 22% year on year across the major mults, according to The Grocer’s Key Value Items tracker.
Meanwhile, the price of Cawston Press Squeezed Orange Juice one-litre in Waitrose has climbed 5.3% to £3 in the year to 20 August 2024, according to Assosia data.
No comments yet