RD.COM Saber Gesellschaft
Laurie BudgarUpdated: 09/02/2023
Prepare to shell out even more for some of your favorite items thanks to maritime wars, labor issues and climate change.
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feel the pinch
If it looks like the pandemic is still messing with your wallet, don't get imaginative. In August, the consumer price index, which measures the cost of a "shopping cart" to the average urban consumer, showed prices rose an average of 5.3% year-on-year. That's just one of the ways city life could change after the coronavirus. Price inflation – andtip– seems to hit everything from entertainment and electronics to necessities like food, clothing and shelter.
What's behind all the high prices? The global shortage of containers has led to bidding wars to get products onto ships. Add to that a labor crunch and the result is long (and expensive) delays in transporting products from shipping ports to warehouses and ultimately to consumers' doors. "There are a lot of bottlenecks along the way," says Krishnakumar (KK) Davey, PhD, president of strategic analytics at IRI, a Chicago-based data and analytics firm. In recent days, President Joe Biden has announced agreements with the ports of Los Angeles and Long Beach - which together account for 40% of US container imports - to operate 24 hours a day to resolve these bottlenecks.
Raw material shortages and the effects of climate change often compound the supply problem. What's more, says Jennifer Christ, research manager for consumer and commercial goods at The Freedonia Group, consumers are compounding the problem by stocking up on non-perishables, even if they aren't perishable.The pandemic may have changed your priorities. "People think, 'If prices keep going up, I better buy some of these.' Also, they might be worried about going to one of these stores on a regular basis.Places where you are most likely to get the coronavirus.We've detailed the price increases below.
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computers and electronics
computers, cameras, televisions,video doorbells, kitchen utensils and even electric toothbrushes rely on microchips to function. And the world currently has a very limited supply of these microchips. When COVID-19 first hit, factories making microchips closed as orders piled up. These factories are still struggling to meet demand. It doesn't help that a Japanese microchip factory was damaged by fire and a factory in Texas temporarily closed during February's brutal storms. In Taiwan, where 63% of the world's chips are made, a severe drought has threatened chip manufacturing, which requires large amounts of water. Some big TVs cost around 30% more today than they did a year ago. Experts believe that the chip shortage could last until early 2023.
Cars also rely on microchips (sometimes called semiconductors) for dozens of advanced functions. But when the pandemic hit, many automakers anticipated a drop in sales and canceled microchip orders. When sales resumed, factories were unable to ramp up enough to meet demand. As a result, Ford, General Motors and other manufacturers will sell 1.5 million to 5 million fewer vehicles this year, and available vehicles will cost 7.6% more than they did a year ago.
Christ notes that with inventory so limited, the usual tactic for closing a deal — buying at the end of a month or quarter, when sales reps are trying to hit quotas — won't be effective this year. “People pay more when they need a car.” If you think a great used car is the next best thing, think again. The price of used cars increased by 31.9%, according to the CPI. The good news is that car prices start to rise at lower prices. Stocks can be replenished later this year, but the shortage will be felt at least until 2022.
Rental cars are not immune to the COVID effect. At the beginning of the pandemic, when there was nobody on the road, car rental companies sold most of their fleets to generate revenue. With supply falling and demand rising, the average cost of renting a car last July was 73.5% higher than the year before. If you're thinking about forgoing a rental car and just using a ride-hailing service on vacation, note that Lyft and Uber also charge more. The shortage of drivers willing to risk their health indoors has driven prices up.
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Gas prices rose 42.7 percent last year, according to the CPI, with several contributing factors. At the start of the pandemic, many of the countries that produce crude oil – which is in turn used to produce gasoline – reduced production because lockdown restrictions prevented travel. "Then prices started to go up again when people started taking road trips — it seemed like a safer way to travel," says Christ. But oil producers were surprised by the resurgence in demand and raised prices to compensate for the low supply. As production slowly rises, oil-rich countries are wary of resuming pre-pandemic levels only to face another sudden drop in demand. In addition, domestic gas production was briefly disrupted when Hurricane Ida made landfall on the Gulf Coast of Louisiana in August and nine oil refineries were temporarily closed.
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If you're reading this in your yoga pants and sweatshirt, you might be surprised to learn that apparel prices are up 4.2% compared to last August. One factor: rising cotton prices, driven in part by former President Trump's trade policy toward China, and President Biden largely resisted. Retail workers are also demanding higher wages in today's new reality. And since loungewear and athleisure are the new must-haves, their prices have risen accordingly. There was also some lag when it came to going out clothes, with prices for dresses rising 11.9%, while men paid 4.7% more for suits and jackets. Likewise, Davey says kids going back to school this fall need new clothes after a year of growth spurts, and prices have risen with them (1.4% for boys and 2.8% for girls). Here it iswhere can i sell old clothes.
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Major toy makers have warned that their ability to get some of the most popular items on shelves in time for Christmas shopping will be limited. Once again, the global maritime crisis is to blame, so the makers of popular brands like LOL Surprise! and Fisher Price. Even companies that arranged to ship containers before the holiday season plan to increase prices by 5% to 10% to offset the additional shipping costs. Kids have always had crazy toy fashions and today is no exception. When the kids in your life are crushed without one (or more!)hottest christmas toys, be sure to buy in advance.
Even if you get all the toys your kids dream of, you should also have a tree to stack them. According to the American Christmas Tree Association, both live and artificial trees will be in short supply this year. Weather events such as fires and droughts in the Pacific Northwest have impacted tree plantations, while the shipping crisis could push artificial tree prices up by as much as 25%. Even ornaments and skirts to decorate the tree can be harder to find and more expensive when you do find them.
The story behind the housing crisis - prices were 18.1% higher in August than the previous year - is similar to other categories: material shortages and working conditions led to a low inventory of homes for sale. Fortunately, the price of at least one of these materials - wood - has finally returned to normal. However, Cristo says other factors such as B. Zoning restrictions in many communities that restrict home construction are in limited supply. Plus, she says, many people who might be interested in selling are reluctant to let strangers roam their homes in the middle of a pandemic. Some analysts expect housing inflation to stabilize next summer.
For renters, here's the verdict on whetherthe rent will go down.
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Eat at home
Food prices continue to rise, with an average price increase of 3% over the same period last year. But that's not the whole story.Certain types of foods show more notable increases. Take bacon, for example. The average price is now just over $7 a pound, up more than 25% from the $5.56 price a year ago. But it's not the only protein that costs more. Both steak and eggs are seeing dramatic increases of nearly 20% or more.
Meat prices started to rise at the beginning of the pandemic, when the COVID outbreaks forced the closure of several factories. Drought raised feed prices. And the lack of competition in the industry — just four companies handle most of the meat processing in the United States — means that prices have remained high.
Washing these foods is also becoming more and more expensive. Both Coca-Cola and PepsiCo announced price increases due to labor and supply chain issues. In addition to their iconic sodas, both brands also sell popular juices, teas and water. Coffee prices are also rising due to drought and frost in Brazil, the world's largest coffee producer.
“We assume that inflation will persist in the food and hospitality sector for the next three to four quarters,” says Dr. Davey
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Would you rather book than have dinner? Don't expect it to be cheaper. Restaurant prices are also rising, with prices averaging 4.7% higher than a year ago and 6.9% higher at “limited service” restaurants. Restaurants are feeling the same pressure on food prices as consumers are due to shipping and raw material challenges. Starbucks has reported difficulties sourcing various menu items, from flavored syrups to chai tea bags. In addition, working conditions forced the industry to raise wages. Many restaurants are also experiencing new expenses that weren't on the menu before the pandemic, such as stocking up on personal protective equipment, working with third-party delivery services and maintaining outdoor dining spaces. And with winter approaching, it can be difficult to lure guests inside, as the restaurants remain one of the fewThe best places where you are likely to get infected with coronavirus.
Hospitals are paying more for supplies this year, and not just masks and gloves. Devices like cardiac defibrillators, exam tables and IV stands that rely on raw materials like metal, plastic and microchips are now scarce and cost more when they are available. Ambulances are also late. Ford Motor Co., which makes chassis for 70 percent of US ambulances, ended production at four of its plants in April due to a lack of microchips. In September, the American Ambulance Association Denver7 said that production had fallen by 30 to 50 percent.
At least one medical group in California has lobbied insurers to cover their additional costs, but insurers have backed off. It's unclear whether these costs will be passed on to consumers. "A lot of what we pay for in healthcare isn't transparent," says Christ. Meanwhile, the cost of some household products is rising. Makers of diapers, incontinence products, feminine hygiene products and, yes, toilet paper say they are raising prices to address supply chain issues.
76% of Americans spend at least some of their time playing video games, and in the first six months of 2021, the amount of money spent on video games increased by 35%. It could be that games are now attracting older players (45-64 year olds play up to 16 hours a week) because they need more disposable income to pay for their games. Nintendo and Sony have announced that they cannot produce as many Switch and PlayStation 5 consoles as they would like, respectively, due to a lack of microchips. This shortage is likely to drive up prices.
The games themselves have also become more expensive. For 15 years, the standard price for most games was $60, but Sony Playstation and Microsoft Xbox raised their pricing scheme to $70 last fall, citing higher spending as games become more popular. sophisticated. Even "retro" games - games made to be played on consoles released before the Playstation 4 and Xbox One - cost an average of 33% more than they did before the pandemic began. Even watching some favorite shows on TV will cost more as Hulu announced a $1 price increase for its streaming video service. see how you canSave money by streaming.
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Old-school entertainment will likely cost more, too. Publishers warn of the shortage of physical books. In the first half of 2021, book sales are up 18.5% year-over-year, with adult and young adult (YA) fiction leading the way. But publishers are struggling to produce as many books as we want to read due to paper shortages, manpower issues and delivery difficulties. If you don't want to pay pandemic prices for your fiction fix, check out these places where you can.Read books online for free.
planning the future
Even if you manage to find (and afford) all the products you and your family will need for 2022, don't expect the supply and price issues to ease in the new year. "It seems common enough that many of these challenges will persist well into the next year," says Christ. "There is more controversy about whether it will be okay in 2023." However, it's not all bad news. Some of the positive changes that have occurred as a result of the pandemic, such as the availability of online shopping or allowing restaurants to deliver alcohol with food, are likely to continue. “If there is a non-pandemic reason, like B. Comfort that a pandemic habit still exists, people will continue to do it,” says Cristo. "Rather than making things go back to the way they were in 2019, it's more about moving forward from where we are today."
- Krishnakumar (KK) Davey, PhD, President of Strategic Analytics at IRI, a Chicago-based data and analytics firm
- Jennifer Christ, Consumer and Commercial Goods Research Manager at The Freedonia Group
- US Bureau of Labor Statistics: Summary of the consumer price index
- US Bureau of Labor Statistics: Consumer Price Index for all urban consumers (CPI-U): US city average, by detailed spending category
- Denver7: "Global chip shortages are causing problems for first responders"
Original Post: October 14, 2021
Laurie Budgar is an award-winning lifestyle, health, travel and business journalist and a regular contributor to RD.com and other national magazines and websites. Her superpower is making complex information not only easy to understand, but also vivid and engaging. Budgar is also a Board Certified Speech-Language Pathologist (MS, CCC/SLP) who has spent over a decade helping people with brain trauma, stroke, multiple sclerosis, Alzheimer's and other neurological conditions regain their speech, language, swallowing and cognitive skills. .
What items are inflation in 2022? ›
Inflation in 2022 hit its highest level in four decades, according to consumer price index data. Some items, such as school meals, eggs, margarine and fuel oil, saw a more dramatic upswing in prices.What things will go up in value? ›
- Stocks. Shares of stocks represent partial ownership of a company that trades publicly on the stock market. ...
- Real Estate. ...
- Rare Art. ...
- Fine Wine. ...
- Cryptocurrencies. ...
- Gold, Silver and Gemstones. ...
- Alternative Investments.
Key points. Inflation seems to be slowing, and some things could start to get cheaper in 2023. The cost of real estate, rental, cars, and gas could fall, at least a little. Don't get too excited about potential price drops, as there's still a lot of uncertainty about the economy.Are prices going up in 2022? ›
In 2022, food prices increased by 9.9 percent. Food-at-home prices increased by 11.4 percent, while food-away-from-home prices increased by 7.7 percent. All food price categories tracked by the U.S. Department of Agriculture (USDA), Economic Research Service (ERS) increased by more than 5 percent.What should I buy to beat inflation? ›
Perhaps the most obvious choice of real asset to protect against inflation is gold, which acts as a store of value. One of the most convenient ways to gain exposure is the yellow metal is to buy one of the physically backed ETFs such as iShares Physical Gold that invests in the actual bullion.What item holds its value the best? ›
- Real Estate. Real estate has to top a list like this. ...
- Tokenized Real Estate. It can be emotionally exhausting to invest heavily in something as volatile as cryptocurrency. ...
- Quality NFTs. The non-fungible token (NFT) is the poster child of a risky investment. ...
- CDs. ...
- Index Funds. ...
One of the most popular assets that appreciate in value is real estate. You can start by buying single-family rental homes. Also multi-family homes such as apartments, commercial real estate like malls or offices, and even land. Real estate is a long-term investment.
Inflation doesn't end, it just gets less bad. And, in fact, we don't want it to end entirely. The Federal Reserve, the US central bank tasked with lowering the rate of inflation through a series of interest rate hikes, is aiming for a target of around 2%. That means that prices will still rise, just not nearly as much.Will food prices go down in 2024? ›
In domestic currency terms, however, food prices remain elevated due to currency deprecations. Food prices are expected to fall 5% in 2023 before stabilizing in 2024.What is the cheapest thing in world? ›
The answer is: wheat. Actually, the entire agriculture complex, including corn, beef, pork and beans could fit this description. The answer is: wheat.
What items have increased in price in 2022? ›
Of the 30 sampled lowest-cost items, nine increased by more than 20% in the year to September 2022. The lowest-cost vegetable oil, pasta and tea were the items that experienced the largest increases in price during this period. Vegetable oil rose by 65%, pasta rose by 60%, and tea rose by 46%.Will inflation drop in 2023? ›
Forecasters project that inflation will decline next year. There is considerable disagreement over the size of the reduction, mainly reflecting uncertainty about how fast the hot economy and labor market will cool off. But whatever happens to the labor market, inflation is likely to fall far below wage growth in 2023.How long will inflation last in 2022? ›
But in Morningstar's second quarter “U.S. Economic Outlook,” researchers predict that 2022 will have the highest rate of inflation, as measured by the PCE price index, at 5.2%, before dropping. Caldwell estimates that the inflation rate will average around 1.5% between 2023 and 2025.What should I buy to avoid inflation? ›
Common anti-inflation assets include gold, commodities, various real estate investments, and TIPS. Many people have looked to gold as an "alternative currency," particularly in countries where the native currency is losing value.What should I buy now to avoid inflation? ›
Make inflation-proof investments
If you want to reduce the risk, avoid being too exposed to a small number of assets or sectors. A good way to diversify is by buying into investment funds. Funds can invest in various assets, so can spread your money across bonds, property and shares in different sectors.
- Borrowers With Existing Fixed-Rate Loans.
- The Energy Sector.
- The Food and Agriculture Industry.
- Commodities Investors.
- Banks and Mortgage Lenders.
- Landowners and Real Estate Investors.
Gas, Car Repairs, Energy, and Food Prices Rose in 2022
If your vehicle broke down, repair costs definitely took a toll. Fixing your car cost close to 21% more since the beginning of 2022. Car insurance was also on the list of items hardest hit by inflation this year, rising nearly 17%.
Less expensive tangible assets that do well during inflation include many types of commodities. Agricultural commodities like wheat, corn, soybeans, livestock and timber are among such commodities. Industrial metals like nickel, copper and steel also tend to do well during inflation.Where do you put cash during inflation? ›
Mortgage-backed securities (MBS) and collateralized debt obligations (CDOs) are risky choices but tend to perform well under inflationary pressure. Investment real estate is traditionally a safe haven but should be approached cautiously in 2022 and 2023 given the unsettled state of the industry.What assets never lose value? ›
- Collectibles like art, coins, or memorabilia.
- Investments like stocks and bonds.
- Buildings that you aren't actively renting for income.
- Personal property, which includes clothing, and your personal residence and car.
- Any property placed in service and used for less than one year.
What doesn t go down in value? ›
Diamonds. Diamonds are known to retain their value, or even increase in value over time.What has a high resell value? ›
|Rank||Model||5-Year Resale Value|
|1||2022 Toyota Tundra||70.2%|
|2||2022 GMC Sierra||60.8%|
|3||2022 Toyota Tacoma||60.6%|
|4||2022 Ford Maverick (tie)||59.5%|
The Living Values series offers a variety of experiential activities for teachers and parents to help them teach children and young adults to develop twelve critical social values: cooperation, freedom, happiness, honesty, humility, love, peace, respect, responsibility, simplicity, tolerance and unity.What are the 7 types of values? ›
What are the 7 core values? The seven core values include honesty, boldness, freedom, trust, team spirit, modesty, and responsibility.What are 3 top values? ›
To most Americans, the most important values are having a happy relationship, an honest and respectable life, and safety and security. Understanding your own values is a fundamental part of self-awareness and getting to know yourself as a human being.What is the safest asset to own? ›
Some of the most common types of safe assets historically include real estate property, cash, Treasury bills, money market funds, and U.S. Treasuries mutual funds. The safest assets are known as risk-free assets, such as sovereign debt instruments issued by governments of developed countries.What is a good asset to buy? ›
- Dividend stocks. ...
- Bonds. ...
- Real estate. ...
- Money market funds. ...
- Certificates of deposit. ...
- Money market accounts. ...
- High-yield savings accounts.
- Certificates of deposit (CDs)
- Money market funds.
- Government bonds.
- Corporate bonds.
- Mutual funds.
- Index funds.
- Exchange-traded funds (ETFs)
The impact inflation has on the time value of money is that it decreases the value of a dollar over time. The time value of money is a concept that describes how the money available to you today is worth more than the same amount of money at a future date.Will food prices go down in 2025? ›
Speaking to CNBC, Morningstar's head of U.S. economics, Preston Caldwell, hinted that this year's Personal Consumption Expenditures Price Index (PCE) — the same broad inflation measure used by the Fed — will be around 5.2% before dropping to around 1.5% between 2023 and 2025.
What year will inflation end? ›
Kiplinger predicted that "the slowing economy is likely to bring the yearly inflation rate down to 3.2 percent by the end of 2023." Preston Caldwell, head of U.S. economics at Morningstar, told TIME's NextAdvisor that "we expect inflation to undershoot 2 percent in 2023 and 2024," as sources of the current high rate ...Will there be no food in 2050? ›
By 2050, with the global population expected to reach 9.8 billion, our food supplies will be under far greater stress. Demand will be 60% higher than it is today, but climate change, urbanization, and soil degradation will have shrunk the availability of arable land, according to the World Economic Forum.Will there be a food shortage in 2023? ›
Champagne will be in short supply in 2023, not just because of the drought, but because demand has rebounded from the pandemic faster than producers can create the bubbly beverage. Butter, corn, tomatoes and eggs are also on the list of potential shortages, as well as baby formula.Will the world run out of food in 2023? ›
The WFP predicts that by 2023 there will be a shortage of wheat and corn, which are two staple products in the food supply chain. The reports also estimate that these shortages will increase global food prices and could even trigger a new global recession.What's the richest thing in the world? ›
Research on dozens of sites to find the priciest real estate, artwork, yachts and jewels pinpoints the world's most expensive item right now: the History Supreme Yacht, measuring 100-feet long and costing $4.5 billion.What is the cheapest state to live in? ›
- Kansas (86.4)
- Alabama (87.5)
- Georgia (87.8)
- West Virginia (88.5)
- Missouri (88.6)
- Indiana (88.9)
- Iowa (88.9)
- Tennessee (89.5)
Vietnam. One of the cheapest countries to live in is definitely Vietnam. Vietnam offers a beautiful mixture between the ancient and the modern, and with its beautiful landscape, beaches, and history, it is an experience you will never forget.How to survive inflation 2022? ›
- Budget. The best way to withstand a bout of financial hardship, Hughen suggests, is to budget for it in advance. ...
- Apply for assistance early. ...
- Avoid new debt, especially on credit cards. ...
- Put off big purchases. ...
- Invest for the future.
But even if their predictions are accurate, the prices we pay for things may remain at a high level compared to previous years. The tax and audit consultants, RSM suggest that we won't see the end of the crisis until the latter half of 2023 when household incomes are likely to increase, and inflation drops back.What is rapidly increasing prices? ›
Inflation is the rate of increase in prices over a given period of time. Inflation is typically a broad measure, such as the overall increase in prices or the increase in the cost of living in a country.
Will the US go into a recession in 2023? ›
The labor market is cooling down, putting less pressure on wages, while housing prices and new construction have both declined. Unfortunately, this slowdown in economic activity will likely come with a cost: According to Bloomberg's December 2022 survey of economists, there is a 70% chance of a recession in 2023.What is causing inflation? ›
It's the unexpected increase in demand (or decrease in supply) that sets off inflation. Along those same lines, how much inflation people expect affects how much inflation we actually get. As prices of goods rise, workers aren't able to buy as much with their wages.Will there be a cost of living in 2023? ›
Social Security benefits and Supplemental Security Income (SSI) payments will increase by 8.7% in 2023. This is the annual cost-of-living adjustment (COLA) required by law. The increase will begin with benefits that Social Security beneficiaries receive in January 2023.Will food prices go down in 2022? ›
The increases are a result of supply constraints driven by difficult-to-predict variables— high energy prices, geopolitics and weather—but analysts with Morgan Stanley Research are forecasting that food prices will peak in 2022 and start falling in 2023.Is inflation a bad thing? ›
For many, the term inflation is a signal of bad things in the economy. Consumers face rising prices, escalating risk of layoffs, and decreasing purchasing power. This is especially true for those who do not receive salary or wage increases that keep up with the cost of living.Will inflation go down in 2024? ›
“Combining these factors with tightening monetary policy, we expect inflation to undershoot 2% in 2023 and 2024.”What products are being most affected by inflation? ›
Items That Are More Expensive Because of Inflation
These items have seen some of the largest price increases over the past 12 months: Meats, poultry, fish and eggs: 8% increase. Fruits and vegetables: 9.3% increase. Electricity: 14.1% increase.
Plane tickets, eggs, butter, margarine, and car repair and insurance were some of the hardest hit by inflation this year. Table with 2 columns and 20 rows.What are some of the different goods that have increased in price in 2022? ›
- Gasoline. 12-month increase: 48.8 percent. ...
- Used Cars and Trucks. 12-month increase: 35.3 percent. ...
- Airline Fares. 12-month increase: 23.6 percent. ...
- Beef. 12-month increase: 20.4 percent. ...
- Furniture. 12-month increase: 16.8 percent.
Demand for services is still on the rise, while the demand for goods continues to moderate. A December analysis by supply chain firm Flexport found the consumer preference for goods is holding steady. This period of inflation could end by the middle of 2023, Hogan estimates.
Where is inflation hitting the hardest? ›
The big picture: The Miami, Phoenix, Seattle and Atlanta metro areas had the highest annual inflation rate increases as of December 2022, according to the latest Consumer Price Index.What will economic predictions be in 2023? ›
Global growth is projected to fall from an estimated 3.4 percent in 2022 to 2.9 percent in 2023, then rise to 3.1 percent in 2024. The forecast for 2023 is 0.2 percentage point higher than predicted in the October 2022 World Economic Outlook (WEO) but below the historical (2000–19) average of 3.8 percent.What is food inflation 2023? ›
International food prices are estimated to have added 5 and 6 percentage points to consumer food inflation in 2021 and 2022, respectively, and are forecasted to add an estimated 2 percentage points in 2023.What are the two major causes for rising prices? ›
There are two main causes of inflation: demand-pull and cost-push. Both are responsible for a general rise in prices in an economy, but each works differently to put pressure on prices. Demand-pull conditions occur when demand from consumers pulls prices up, while cost-push occurs when supply costs force prices higher.What food has increased in price? ›
The figures, based on web-scraped supermarket data for 30 everyday grocery items, showed the cost of items had already increased 7% in the year up to April. Over the past year, tea went up by 46%, chips by 39%, bread by 38%, and biscuits by 34%.