Pizza suffers from milk inflation, and price rises up to 30%

Pizza is up to 30% more expensive for Brazilians this year, and the reason now is dairy products. Pizza Day, celebrated around the world this Sunday (10), arrives with the product weighing more in the pocket. Pizzerias say they have not yet passed on even half of the increases they face in the cost of production.

The president of Apubra (Association of United Pizzerias in Brazil), Gustavo Cardamoni, says that, since the beginning of the pandemic, in March 2020, the sector has suffered from a rise in inputs. “One hour is the sausages, another is the flour or the tomato. In the last two months, we had an absurd increase in dairy products. Mozzarella, which cost R$ 24, now exceeds R$ 50”, he says.

Dairy products represent 50% of the purchase of inputs from a pizzeria. Between March 2020 and March 2022, the cost of milk production rose 64%, according to an estimate by Embrapa Gado de Leite, mainly because of the high prices of soy and corn, widely used in animal feed.

Although the fillings vary according to the region of the country, the cheese is almost unanimous. According to Cardamoni, in some cities, the item is even present in sweet pizzas.

The pizzerias’ bill also includes higher rents, electricity and gas. The fixed cost also includes cardboard packaging, which rose 80% in two years.

To contain spending, owners are reducing menu options and avoiding promotions. As a result of the constant price readjustments, even leaflets distributed have changed and no longer show the prices of pizzas. The strategy is also used in the menu of some establishments.

“We’ve never seen inflation like that. We had seasonal peaks. In the cold season, there was always an inflation of 10% in dairy products. Now, it’s systemic. In these last months, everything practically doubled”, says Gabriel Concon, CEO of Pizza Prime, who has just created an intelligence area in the company to face the new economic scenario.

“In addition to inflation, there are products that you can’t find anymore to buy. Before, we worked with two brand options, now, we need to have five”, says Concon.

Alex Agostini, chief economist at Austin Rating, calculated a Pizza Index at the request of Sheet. The calculation considers the IPCA (National Broad Consumer Price Index) from January 2020 to July 2022 and the main ingredients of the mozzarella pizza.

“The price soared. In the last 12 months alone, there was a high of 34.7%”, says Agostini.

Gustavo Cardamoni says that all pizzerias are working below their usual profit margin and warns that the sector still pays off loans acquired during the pandemic. “Many pizzerias are paying these installments, they are in debt amid all the high costs. There are many paying to work, and others being put up for sale.”

In the country that produces more than 4 million pizzas a day, the frequency of orders has decreased, also a reflection of the fall in the income power of Brazilians. The number of orders per week and the amount allocated to pizza go up according to family income.

According to Rodolfo Ribeiro, one of those responsible for the Mozarela Index, for every BRL 1,000 more in family income (measured by the individual’s neighborhood of origin), willingness to pay increases by BRL 2.62. That is, for the same pizza, individuals with family incomes “price” the product with a difference of more than R$10.

“If we pass on all the costs, we don’t sell. But, this year alone, I’m going to the fourth price adjustment, and I had to reduce the team. I make some deliveries myself”, says the owner of a pizzeria in Vila Leopoldina (west ) Daniel Kusters.

According to Apubra, about 112 thousand pizzerias CNPJs are currently active in Brazil. More than 54.4% of them are MEIs (Individual Microentrepreneurs). Cardamoni says that there are still hundreds open in informality.

São Paulo remains the Brazilian state that consumes the most pizza and is among the world leaders. Are
approximately 26,160 pizzerias in the state, according to Apubra. The second place in number of pizzerias is occupied by Rio de Janeiro (9,739), followed by Minas Gerais (7,668), Bahia (5,281) and Paraná (4,689).

Pizza Day has been celebrated on July 10 in Brazil since 1985 by order of the then secretary of tourism Caio Luiz de Carvalho, after a contest was held in São Paulo to choose the ten best recipes for mozzarella and margherita.

Chains make promotions for Pizza Day

This Sunday, major networks will celebrate the date with offers. Domino’s Pizza will give 50% off any large or medium, thin or traditional pizza. Pizza Prime will have “Combo Premium”, with 35 cm pizza accompanied by a 1.5 liter soda for R$ 67.90. Pizza Hut will publicize the offers on the day on its social networks.