From milk to meat, US food prices spike upward
The rise in grocery costs is up more in the first six months of 2007 than in all of 2006.
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In the heartland, low yields on winter wheat mean cookies and baguettes are more expensive. Meat costs are up by 15 percent in some regions, in part because of drought that, as in Alabama, caused a cattle sell-off. Milk prices are up in part because of a global shortage, with milk exporters such as New Zealand unable to add capacity and Australia enduring a debilitating drought, even as demand rises in Europe, China, and India.Skip to next paragraph
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Because of the multiple causes, some prices may drop in coming months and as new crops come in, says Patrick Jackman, an economist at the Bureau of Labor Statistics, which tracks grocery store costs in population centers across the country. A few years ago, he says, iceberg lettuce spiked 113 percent after a freeze. Today, a head of iceberg is one of the few items to decrease in price – from $1.19 to 99 cents.
Still, household budgets are taking a "double whammy" at the grocer's and at the gas station, says Mr. Jackman. Barrels of sweet crude are expected to stay at about $60 per barrel. A family's average grocery tab could leap from $300 a month last year to $400 a month this year, economists say. "People have to adjust by cutting back," he says.
For some consumers, it's tough to hang on. In Savannah, Ga., the Salvation Army expects to serve 10,000 more meals this year because of high food prices. Americans are coping, too, simply by food shopping less often. Their average number of grocery store trips each week dipped below two for the first time since the Food Marketing Institute began its annual survey.
"You could get culture shock coming into this place, and it's not getting better," says Richardson Daniel, a longtime resident of Boston's Roxbury neighborhood, swooping into Shaw's.
Most customers are content, for now, to grumble, says Mike Wetzel, manager of Wetzel's Market in Glen Rock, Pa. What about? For one, ground beef at Wetzel's is up from $1.49 a pound last year to $1.79.
"Five-dollar milk by the end of the summer – that's the big rumor," Mr. Wetzel said in a phone interview. "It's one of those things that nobody's happy about, but when everybody's prices go up, they're pretty well stuck." With gasoline prices high, he suggests, consumers are less likely to shop at different stores for bargains.
But one standard is back in vogue: the supermarket flier. Newspaper coupons can take 30 percent off the top of the grocery tab, almost wiping out the recent price increases, economists say. Shoppers are also using websites such as TheGroceryGame.com and SupermarketGuru.com to search for sales and values across ZIP codes. Ms. Wyman, the Boston shopper, takes advantage of 2-for-1 deals, stocking up on essentials.
For Mr. Brady, the Alabama extension agent, there's a lot of meaning in a gallon of milk: a nutritious but perishable drink that's traveled thousands of miles, on refrigerated trucks across the Sonoran Desert, to get to places like Rick's Market in Marion, Ala.
"When I see the rising prices I realize we've actually been very fortunate to have cheap food," he says. "I think that will continue, but we might not have the luxury of what we've had in the past."