Navigating Global Challenges: Our Commitment to Affordable, Quality Health Products

February 2, 2024 Honest to Goodness

While global challenges continue to cause fluctuations in commodity prices and increases in the cost of doing business, the team at Honest to Goodness has been working diligently to adapt and minimise these effects for our customers.

Commitment & Transparency

While we strive to absorb cost increases as much as possible, some adjustments are unavoidable. Our core values prioritise offering accessible and high-quality health foods to all our customers, and we remain dedicated to avoiding unnecessary price increases and passing on savings whenever we can. We want to assure you our commitment to supporting healthy living at fair prices remains unwavering. This process is ongoing, and we will continue to work tirelessly to provide you with the best products and services while navigating the evolving global landscape.

Cost of Living

Right now, more than ever, everyone is feeling pressure from increased cost of living prices, so we thought it essential to explain some of the price movements that we as a business have witnessed in the past 18 months that has affected food prices. The below list is just a snapshot of the many fluctuations we have witnessed in recent times, and we trust our transparency will give you a greater understanding of these fluctuations.

International Logistics

While sea freight costs are not at the COVID levels where some rates increased 200%+, they are higher than historic levels. The higher rates are largely due to:

(a) Attacks on vessels in the Red Sea area has reduced traffic through the Suez Canal, Several shipping companies have diverted their ships around the Cape of Good Hope which has increased shipping line costs due to the added distance.

(b) The Panama Canal drought has reduced daily traffic through the narrow corridor by 40 percent compared to last year. Several ships have already diverted to longer ocean routes, which has increased costs and delivery time.

Domestic Transport

Due to the shortage of drivers and increases in maintenance costs, fuel and insurance, Australian Carriers have increased their rates and added new fees. A similar scenario has been witnessed with insurance premiums, largely due to ongoing flood and bush fire events over the past two years, increasing costs.

Raw Materials/Commodities

Depending on crop yield, crop availability and global demand, the cost of raw materials has seen many fluctuations, both up and down. Honest To Goodness’s strategy is to source commodities from different regions, when possible, to help minimise price increases without compromising quality. Below are just a few examples of products which have seen price fluctuations:

Organic Olive Oil

A combination of initial shortages of staff during COVID and bad weather conditions after COVID, drastically affected organic olive oil supply in key producing regions. As a result, limited supplies have driven prices skywards, with a 115 percent increase in Spain and a 50 percent price increase in Greece between 2022 and 2023. Honest to Goodness was able to change its sourcing strategy to secure Australian Olive Oil where possible and hold more stock to help limit cost increases to customers.

Organic Psyllium Husks 

Organic Psyllium Husks prices doubled in 2023 due to heavy rain in India that significantly reduced supply. The crop for 2024 is looking healthier and we are expecting a price decrease coming through in the second half of the year. 

Organic Sunflower Oil 

Organic Sunflower Oil prices increased more than 25% in 2022-23 with the start of the Russia-Ukraine war, which saw a lot of uncertainty in supply. Since then, the market has adjusted for the new supply cycle and prices have dropped to normal levels. Honest to Goodness adjusted its prices late in 2023 to align with the price fall.

Organic Cashews 

Prices for Organic Cashews are at historic low levels, driven by the reduction in global demand and a considerable increase in supply. Even-though the market is estimating an increase late 2024, we expect prices will continue to plateau due to the supply-demand balance.

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