Food prices resist inflation push

Mrs. Jones may not believe it when the local supermarket clerk totes up her bill, but the prices of a number of food items, especially meat, actually are lower than they were last May.

That's right -- lower, thanks in part to the Carter administration's continuing policy of encouraging farmers to produce. Last week, in the latest of a series of steps to increase production -- and thus help hold the lid on food-price inflation -- US Secretary of Agriculture Bob Bergland announced that farmers would "not" be paid for "not" growing cron and wheat. This generally means, according to economists outside the administration, that more grain will be grown -- even in the wake of last year's bumper crop, which has been a factor in holding food prices down.

But this is not all by any means.

According to the American Meat Institute, representing about 300 meat packers and processors, "beef prices at retail will be very flat" in the coming months because of greater cattle production.

The picture vis-a-vis production is even brighter for other meats. Turkey production is up around 50 percent from a year ago; chicken production is around 6 percent higher and pork production is way up, too.

On the wholesale level, chicken is selling for about 41 cents a pound nationally, on the average, compared with more than 51 cents a pound at the same time last year, says William Roenigk, executive director of the National Broiler Council.

"When you do compare it to energy, housing, and other things, food is a real bargain these days," Assistant Secretary of Agriculture James C. Webster told the Monitor."But it's a mixed blessing because, with prices relatively low, there may be a new pinch coming on farmers."

Still, the fact that food prices are not keeping pace with the overall rise in inflation levels is providing some relief for American consumers. Overall inflation, in the past three months alone, has been running at 15.6 percent a year.

Jason Benderly, an agricultural economist with the private Washington Analysis Corporation, has forecast that food prices will not rise more than 8 percent this year unless poor weather conditions or unforeseen energy cost hikes come into the food price picture. Even if fuel prices continue to climb, economists say, food prices will rise at a rate below the general inflation rate unless there is a major upset in the energy supply situation, such as a cutoff of oil from the Mideast.

According to the National Cattlemen's Association, its montly survey of the retail prices of five cuts of beef in the supermarkets of 19 cities shows that the average price has decreased four times since May. On Feb. 14, the latest date for which figures are available, the average price of the five cuts of beef was $2.39 a pound, compared with $2.41 a pound on Jan. 10.

"In spite of the continuing high basic inflation rate, retail beef prices are still below the peak reached last spring," said an association spokesman.

According to US Agriculture Department statistics, beef prices have not been alone in their downward price cycle. A USDA survey reveals that the price of tomatoes at wholesale markets in Florida were down from $8.88 a carton in February 1979 to $6.50 in February 1980.

Soy beans, used in many food products, went from $7.31 a bushel in February 1979 to $6.29 a bushel this February on the Chicago wholesale market. This is because, in large measure, "there's a huge, huge world supply of oil seeds," said a USDA spokesman.

Hogs on the Omaha, Neb., wholesale market were selling for $36.75 per hundredweight in February, compared with $55.50 for the same month last year.