8th August 2022
Corporate Economy

Food Index Increased by 1.0% in June

Driven by exponential energy prices, The Consumer Price Index for all urban consumers increased by 1.3% in June, after rising by 1.0% in May as reported by the U.S. Bureau of Labor Statistics. The energy index rose by 7.5 % over the month of June, representing half of all the items increase (The gasoline index rose by 11.2%).

The food index rose by 1.0% in June, as did the food at home index. The all items less food and energy index rose 5.9 percent over the last 12 months. The energy index rose 41.6 percent over the last year, the largest 12-month increase since the period ending April 1980. The food index increased 10.4 percent for the 12 months ending June, the largest 12-month increase since the period ending February 1981.

“CPI delivered another shock, and as painful as June’s higher number is, equally as bad is the broadening sources of inflation,” said Robert Frick, corporate economist at Navy Federal Credit Union in an interview with CNBC. “Though CPI’s spike is led by energy and food prices, which are largely global problems, prices continue to mount for domestic goods and services, from shelter to autos to apparel.”

Inflation rate in the US June 2022

As Earning Season Approaches, What are The Outlooks For Indoor Vertical Farming Companies?

Many companies will state increases in revenues and perhaps, in some cases, in profitability despite not having yet increased their production capacity. Whilst some investors may be attracted to buying their shares or contributing to their funding round, revenues will need to be adjusted to inflation and investors may want to pay a close attention to: 

  1. The number of produce they had on a YTD basis
  2. The costs they incurred compared to previous year

Energy represents in a lot of indoor vertical farming facilities the bulk of their operating expenses (OPEX). The current energy prices has forced many companies in the sector to research ways to decrease their energy consumption, or rely on greener energy sources to further the profitability of their installations as well as decreasing the impact on the environment.

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