CPG · Answer

Did CPG companies keep the savings when commodity prices fell?

Mostly they never got the savings in the first place. Across 42 US food and household SEC filers above $1bn in revenue, median gross margin fell 0.92 points between FY2019 and the latest filed year, from 38.93% to 35.94%. Only 14 of the 42 expanded. A control group of 15 filers outside the category moved the opposite way, up 1.99 points. Input costs did not fall as a block — they split, and the half that fell is not the half these companies buy most.

The evidence

The category and the control moved in opposite directions.

Median gross margin went 38.93% to 35.94% for food and household, and 38.19% to 39.84% for a seeded sample of filers outside the category drawn by a declared rule. Without the control a fall of under a point looks like the economy; with it, it is a category.

Cocoa beans more than doubled while soybean oil fell a quarter.

US import unit values 2022 to 2024: cocoa beans +109%, chocolate preparations +26%, bananas +7%, rice +4%, coffee +1% — against soybean oil −27%, palm oil −25% and aluminium plate −16%. The oils and the packaging metal came down. The tree crops went up.

The two worst-hit companies are the two biggest chocolate companies.

Hershey fell 11.81 points, from 45.4% to 33.5%. Mondelez fell 11.59, from 40.0% to 28.4%. By industry group, sugar and confectionery was worst at −5.96 points while bottled and canned soft drinks gained 2.13 over a period when aluminium fell 16%.

There is no useful category average to benchmark against.

Latest gross margin across the 42 runs from 13.8% at the tenth percentile to 61.2% at the ninetieth — a 47 point spread against a median six-year movement of under one point. The gap between companies is roughly fifty times the movement over time.

What would have to be true for this to be wrong

If your cost line is weighted toward oils, packaging metal or grains rather than cocoa, coffee or other tree crops, you did get relief and the category median is hiding it. The usable move is to check your own exposure against the commodity table rather than against a peer average — the average describes almost nobody in this set.

SEC XBRL company facts at data.sec.gov for 42 food and household filers above $1bn CY2024 revenue plus a 15-filer seeded control, and UN Comtrade import unit values for eight commodities, read October 25, 2026 at $0.00 metered. Gross margin is calculated from revenue and cost of goods, not read from a gross profit tag. Every filer and every exclusion is published on the study page.
Every row behind this answer is published in the standing study at cultmath.com/research/cpg/margin-recovery, which is re-run on a schedule and corrected in place, dated.
Published 2026-10-25 by Ipalibo Da-Wariboko, CULT+MATH LLC. Where a number could not be sourced, this page says so and gives none.

This is one of six decisions covered in the cpg decision brief — each with the evidence behind it, who owns it, who it is contested with, and what would have to be true for the answer to flip.

See the brief →