May 31


May 29 (Bloomberg) — Dow Chemical Co., the largest U.S. chemical maker, may not be the last to raise prices this year because of soaring raw materials costs.

Monsanto Co., Hershey Co., General Mills Inc. and Avery Dennison Corp. may follow suit, according to data compiled by Bloomberg. They’re among 11 companies in the Standard & Poor’s 500 Index that increased their so-called LIFO reserve, which captures rising inventory costs, by at least 20 percent over the past four quarters.

With oil and commodity prices at record highs, companies will be forced to pass on higher costs, analysts said after Dow Chemical announced yesterday it will raise prices by the most in its 111-year history. That will contribute to inflation, and may prompt the Federal Reserve to raise interest rates for the first time in four years.

“We are going to see a cascading of higher prices through the system,” said Steve Hoedt, who helps manage $34 billion, including Dow Chemical shares, at National City Corp. in Cleveland. “Companies that are able to push prices through to their customers are the ones that are going to be successful.” Continue reading »

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