> This suggests to me that it's not an actual increase in the cost of producing the product. If it was driven by commodity/input/manufacturing cost prices we should be seeing price pressures coming through in the cheapest cereals.

I don't know about cereal manufacturers specifically, but in general, it costs 25% more now compared to pre-Covid to produce food[0].

The amount Americans spend on food relative to their income has gone up in that same time period, but only from slightly under 10% to slightly under 12%[1], and is still well under historical levels as well as compared to other countries. Not bad for an economic system full of supposed "price gougers".

[0]: https://fred.stlouisfed.org/series/PCU311311

[1]: https://www.ers.usda.gov/data-products/chart-gallery/gallery...