Food Prices are Higher and Rising

Have you noticed the prices on various food products at the grocery store has been going up? Every time we shop for food lately, the prices have been inching up slowly but surely. This rise in food costs brings the need to make the effort to plan ahead as much as possible and to be more selective as we shop.

The price of fuel affects the price of exported food causing pressure to increase prices on wholesale and retail food items. The projection of this year's inflation rate was predicted at two to three percent, but the trend is appearing to be closer to four percent.

The world's food prices rose in January to their highest level since 1990, the year when the United Nations first began keeping a record of food pricing. Compared to 2009, the price of beef products increased six percent, pork is up by eleven percent and the price for poultry rose a little over one percent. When we compare some of the prices to 2010, eggs have increased six percent, dairy by three and a half percent and milk is up five percent. The USDA has also anticipated a price increase this year for bakery and cereal items.

According to a Morgan Stanley survey, customers are paying four percent more on their food bill since October. The owner of a butcher shop in Baltimore said he had to raise the prices of most items twenty percent in recent weeks. He stated that although he understands the complaints of his customers, if he didn't raise the prices he wouldn't be able to stay in business.

Now that the economy has been improving, the demand for meat has returned. After a period of low production, farmers are still working to rebuild their supply. It's reported that in over half a century, cattle and hog supplies had reached their lowest levels. Meanwhile, commodity prices such as wheat, corn and soybeans have risen substantially since December.

Because of their low prices, McDonald's sales boomed during the recession, however, they've stated that they will likely be raising the price of their Big Mac and other items over two percent. Many grocery stores said they've been cutting their overhead costs as much as possible to avoid raising their prices for customers, but some are acknowledging it might become too difficult to continue and remain profitable. The times are precarious and the food markets aren't able to perceive future projections. A spokeswoman for ShopRite supermarkets said, "Sometimes you can ride out some of these cost increases and sometimes you can't. It's too early to tell if we can this time".

A family-owned super market in Baltimore, Santonis, said they're always juggling rising food costs on different items. Also, they recently chose, for example, to not stock grapes because they presumed that the prices were too high to sell. Consumers make adjustments by purchasing more of the generic labels, items on sale, beans and less costly cuts of meat products.

source: weblogs.dailypress.com; newsobserver.com

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