What is Shrinkflation? Check If Your Pan de Sal is Smaller

Prices of fuel and food ingredients are going up, putting businessmen in a quandry -- pass on the cost to consumers or reduce serving sizes, also called "shrinkflation".

Wheat prices aroud the world are higher because of increased demand and the disruption from Russia's war in Ukraine. In your neighborhood bakery, its either the price per piece of pan de sal increased, or the breakfast staple got smaller.

"There is a lot of wheat supply but its just the price is high. I don't think we will be out of wheat. We'll probabaly be out of pruchasing power than out of wheat supply," Philbaking President Johnlu Koa told One News' "The Chiefs" newscast last June 13.

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Koa said he urged members to keep portions unchanged. He said he observed that consumers are buying with less frequency. "Why make it smaller? people want what they're used to."

Price increases in bread are "not prohibitive" compared to fuel, where the per-liter cost is close to P100, Koa said.

What is shrinkflation?

Shrinkflation was first observed before the Great Depression in the U.S. when bakers reduced the size of bread to avoid increasing prices to recover higher costs, Ateneo School of Governance Dean Ronald Mendoza said in a 2019 opinion piece for ABS-CBN News.

Beyond bread sizes, you will know shrinkflation has set it when there seems to be more air than chips in your afternoon junk food fix or a smaller patty in your burger. That patty could also have more flour than meat.

Smaller portions also mean fewer nutrients, say when a lunch plate contains less fish, meat, and vegetables, Mendoza said. 

Shrinkflation is basically a price increase in disguise because you're paying the same price for less.

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