(Reuters) – General Mills (NYSE:GIS) cut its annual sales forecast on Wednesday, hurt by slowing demand for its higher-priced breakfast cereals, snack bars and pet food products.

Shares of the Cheerios cereal maker were down 1% in premarket trading after it also missed second-quarter sales expectations.

High interest rates and sticky inflation are prompting consumers to opt for pantry staples from cheaper private-label alternatives to pricier national brands.

Repeated price hikes, undertaken to offset high input costs, have also pushed consumers to shop smaller pack and basket sizes in a hit to sales for General Mills.

The company forecast fiscal 2024 organic net sales between down 1% and flat, from a year earlier, compared with its earlier forecast for growth of 3% to 4%. Analysts expected growth of 2.4%, according to LSEG data.

Its net sales fell 2% to $5.14 billion, below estimates of $5.35 billion.