How much longer will food prices go up? Californians better get used to it, experts say
Try finding ground beef at less than $2.99 a pound. Or a loaf of whole wheat bread for under $3.
While those prices may be available if you look hard, prices that were common just months ago have become scarce.
The price of food bought nationally at stores for home use went up 12.2% in the year that ended in June, an increase not seen since 1979, the federal Bureau of Labor Statistics said Wednesday. Overall, prices were up 9.1% in the last 12 months, the biggest jump in more than 40 years.
Prices in all six major food categories were way up in the last year, with five increasing more than 10%.
Those up by double digits included meats, poultry and fish; cereals and bakery products; drinks; dairy products and other foods. Fruits and vegetables were up an average of 8.1%
Food is one of the several categories inflation has sunken its teeth in, but the truth is food is notorious for its fluctuation in prices, said Daniel Sumner, a professor with University of California, Davis Department of Agricultural and Resource Economics.
While prices should stabilize somewhat in the months ahead, stuff is still going to cost more and more.
“Underlying inflation affects food like it affects everything else you buy because it affects the costs of all the businesses — whether they are a farmer or supermarket,” Sumner said.
Store-bought food prices are predicted to go up 8.5% to 9.5% this year, well above last year’s 3.5%, the federal agriculture department’s Economic Research Service said in its June analysis.
“Price increases for food at home and food away from home are expected to exceed historical averages and the inflation rate in 2021,” USDA said.
The agriculture department cited a host of reasons for different increases in its analysis.
It cited port congestion and higher shipping costs as a factor in pork price increases. It noted “rapid increases” in consumption has helped push up dairy prices. It said the Russian invasion of Ukraine is expected to help push prices higher, though the increases in interest rates could temper increases as it dampens demand.
A lot of factors combine to drive up prices.
“Farm prices are typically a small part of the overall retail food bill. The overall macroeconomy remains hot and energy costs, labor costs and other non-food costs are contributing to food inflation as well,” said Joseph Glauber, senior research fellow at the International Food Policy Research Institute.
There were often varying reasons some items’ prices have spiked far more than others. Egg prices were up 33.1% over the last year, though the increase slowed to 0.3% last month. Poultry prices jumped 17.3% over the year.
An outbreak of Avian flu has meant a reduced egg-laying population, helping to drive the egg price increase, USDA said.
The agency found “retail poultry prices have been high, with historically low stocks of frozen chicken (also called “cold storage”).”
The Avian flu has also been a factor in poultry prices, since more than 40 million birds have been affected throughout the nation.
Interactive graph shows change over time
In the western region of the U.S., including California, consumers are paying significantly more than before for their staple food items including dairy products; fruits and vegetables; meats and cereals.
The data used in this interactive line graph below, collected by the U.S Bureau of Labor Statistics, was last updated July 2022. According to the visualization, the values are not seasonally adjusted. Here is the percent change in the Consumer Price Index of food in the west region from July 2021 to July 2022.
How can I save on my next grocery bill?
Here are a couple of ways to think critically about what you fill your grocery cart with, said Sumner, who doubles as the director for the UC Davis Agricultural Issues Center:
Change the way you shop - Search for cheaper alternatives to food items. For example, maybe long-grain rice is less expensive than short-grain rice.
“Deal-breaker” items - Decide what your “deal-breaker” items or the products you don’t mind paying a little extra for are.
Buy in bulk - Depending on your space and the size of your household, buying food in bulk is “a great idea.”
Skip pre-made food - Buying the ingredients to make food from scratch is “almost always cheaper” than buying it already prepared.
Research your organic items: Before buying an organic product, research what it means for that item to be organic and decide what about the product being organic do you like.
“Food prices are going to be up and down…and that’s sort of normal for us,” Sumner said. “And that’s one of the things that makes food a little different from other items.”
This story was originally published July 13, 2022 at 1:28 PM.
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