Editor's note: While overall F&B pricing is still up from 2019, coffee and orange juice costs have stabilized as beef prices are increasing. Meeting planners are encouraged to explore menu design to manage budgets in this installment of “Connecting the Dots,” a monthly series with Michael Dominguez, President and CEO of Associated Luxury Hotels International.
Michael Dominguez: On this episode, we're really talking about food and beverage and what is happening in the food and beverage arena. First and foremost, food and beverage is still up 23% from where it was in 2019. But I'm happy to say that it is no longer a universal story around food costs and what is happening with many of the items out there. It is very much bifurcated, just like our industry and our recovery, which is something you really have to understand as we move forward.
So, first, beef. Beef is continuing to get expensive. It is on a projection right now to continue to go higher, so beef is going to be the outlier as far as a food item that is going to continue to gain in cost and is already expensive. But where I say things are bifurcated, and there is some positivity, coffee—which had been on an upward trajectory for a long period of time—is finally declining, and that has to do with better weather conditions specifically in Latin and Central America. Things seem to be better in that regard. If you take coffee over the last six months, coffee has declined in its growth, which we haven't seen over the last couple of years. That's a positive.
Orange juice. I talked about orange juice being at record prices. Orange juice is now at record lows.
Olive oil, we called liquid gold, and we talked about this during one of these episodes, and all olive oil is starting to decline. Why? Because a much milder summer in the Mediterranean and a much better supply.
So overall, it is a mixed audience, and thank goodness we are no longer talking about eggs. Eggs are reasonable, they have declined, they have moderated, eggs are back where they are. But beef is going to continue to be the conversation.
I think it's going to be imperative for us to have a lot of conversation with our hotels, talk about menu, menu design, and most importantly, to be educated on where costs are and where there is maybe a little bit of relaxation on certain items. One thing to highlight on a decline and a steady decline, and it never spiked, was salmon and other fish, another option as we continue to move out of this and continue to look at food and beverage in a little bit of a different way. I've also talked in the past and, please don't forget, it has to do with looking at our food and beverage menu design through a week's time. Please take a look and understand that your menu should change as you go further into the week, specifically around the breakfast area where you come off a gala dinner and you might not need something quite as heavy. Those are the things we should be looking at as we move forward, but overall, we’re stabilizing in most areas around food and beverage and that should give us a little bit of comfort as we move forward into the year.