Food Exec Brief: Big Food Breaks Up, GLP-1 Shifts Demand, and 1.3% Inflation Hides True Costs

In this week’s Food Exec Brief, we’re covering:

• Kraft Heinz, Unilever, Hain Celestial, and Keurig Dr Pepper are all splitting up as private equity carve-out deal value jumps from $19.37B to $23.72B in the first half of 2025. Meanwhile, Coca-Cola is investing $10B in US manufacturing through 2030.
• GLP-1 adoption has reached 11% of US adults, up from 3% in 2024, with household grocery spending falling 6% in affected households. About $73B in global food brand value is at risk, with confectionery and savory snacks taking 53% of the impact.
• CPG input costs surged in August, with diesel up 77.8% year-over-year and grains up 17.7%, while the food inflation rate came in at 1.3%.

Big food is breaking apart, and Coca-Cola is betting on expansions

Portfolio separation is accelerating across the industry’s biggest names. Kraft Heinz, Unilever (ice cream), Hain Celestial (international), and Keurig Dr Pepper (coffee/beverages) are separating key units, aligning with a surge in private equity carve-outs to $23.72B across 145 deals in H1 2025 (up from $19.37B across 127 deals in H1 2024). The goal is to stop legacy margin discipline from limiting growth brand capital. (Learn more)

Coca-Cola and its bottling partners are committing $10B in US infrastructure spending through 2030, covering bottling plants, production facilities, and distribution centers across at least eight states. The investment includes Fairlife plant expansions in Michigan and New York; bottling operations in California, Colorado, Indiana, and Alabama; and a distribution center in Florida. The announcement follows early-2026 layoffs. (Learn more)

GLP-1 and the value shift are increasing pressure for branded food

GLP-1 adoption has become a live demand signal. GLP-1 use has grown to 11% of US adults (up from 3% in 2024), with over 137M eligible. Users consume 700 fewer daily calories, cut grocery spending by 6%, and reduce intake of processed foods, sugary drinks, refined grains, and savory snacks. Analysts estimate $73B in global food brand value is at risk; confectionery, chocolate, and savory snacks make up 53% of at-risk value despite being 30% of total brand value. Brands repositioning include Nestlé (Vital Pursuit), Conagra (GLP-1 friendly Healthy Choice), and Danone (Oikos for muscle retention). Unprepared brands are losing market position. (Learn more)

Years of inflation have pushed consumers into a value discipline that’s squeezing mid-market brands off the shelf. Fast-moving consumer goods prices jumped 26% between 2021 and 2025. Circana’s August data shows unit demand fell 1.7% year-over-year while dollar sales rose 0.8%. Consumers are buying fewer items at higher prices and skipping the rest. Nearly 60% of shoppers report being more cautious or cutting discretionary spending. (Learn more) 

The result is that premium and value are both growing, and everything in the middle is losing shelf position. Private label sales grew 2.5% in 2024 while national brands declined 0.8%, and Walmart’s Bettergoods approached $500M in first-year sales, one of the fastest-growing private label launches in US food retail history. Brands without clear functional differentiation or a compelling value story are at risk on both ends. (Learn more)

The 1.3% inflation headline is masking a cost issue

August food inflation held at 1.3%. But that’s not what manufacturers buying diesel, grain, and oilseeds are seeing. Diesel prices rose 77.8% year-over-year and accounted for more than one-third of the month’s increase in final-demand goods. Grain costs jumped 17.7% year-over-year, and oilseeds were up 15.8%. Confectionery inputs rose 13.6% annually, with a 6.1% spike in August alone. Paper packaging costs are accelerating again. That difference between input costs and consumer prices is margin that manufacturers are absorbing, and it doesn’t go away on its own. (Learn more)

A longer-term commodity threat is building behind the near-term pressure. The UK’s Food and Drink Federation warns that the 1.3% inflation headline masks supply chain pressure, projecting food inflation at 3.9% by December 2026 and 6.4% by July 2027. (Learn more) 

El Niño risks add to this, with analysts forecasting a 14% ($342.2B) drop in global agricultural output over two years as sea surface temperatures rise 4°C above average by November 2026. Rice is most in danger, with 26% of production at risk and India’s monsoon 13% below normal. Raw sugar also saw its largest monthly gain since October 2010 in August. Sourcing flexibility will be crucial for procurement teams acting now. (Learn more)