Then eggs became the poster child for inflated grocery prices in late 2022, when a mass outbreak of the highly contagious Avian Flu forced farmers to cull their chicken population. The initial outbreak was discovered in February of 2022, and it grew to infect more than 50 million birds (which also explains why last year’s Thanksgiving turkey was so expensive). As Phyllis Rothschild, CMO of egg distributor Pete and Gerry’s, told me, “Those hens would have averaged approximately 5.5 eggs laid per week, so that works out to about 27–28M dozen, per week, missing on the shelf.”
But like many other produce and livestock products, Rothschild says, egg prices also rose because of higher input costs—that is, the price of things that go into raising a hen, like feed and labor. Now, egg prices have fallen down to more reasonable levels. “There’s still fluctuations and periodic increases,” Rothschild says, “but they’re definitely down from their previous highs that we saw, let’s say, in January.”
Some claim high prices are the result of good old-fashioned corporate greed
Producers and sellers of food claim that increased costs from inflation and factors like higher wages are driving prices up, but in reality wages are not keeping pace with inflation. Though higher wages might be responsible for a slightly higher price for consumers, the increase in retail cost for items is often rising higher than employee wages. In fact, many food producers have been accused of raising costs simply because they can. “Corporations have used inflation, the pandemic, and supply chain challenges as an excuse to exaggerate their own costs and then nickel-and-dime consumers,” Kyle Herrig, president of watchdog organization Accountable.us, alleged to The New York Times. In 2022, the average price of potato chips was $5.26 in January. By December of that year that number had increased to $6.28. Meanwhile, the Times reported, PepsiCo, the owner of Frito-Lay, increased profits by 20 percent in its third quarter alone.
Positive news: Prices have started to even out, with some notable exceptions
Suffice it to say there’s a lot of things that contribute to grocery prices, and they’re all interlinked. So where do we stand now? Overall, grocery prices won’t be increasing in the way we saw last year, though there may still be slight increases, as there were in May. Because those price increases are on top of the unusually high price hikes of 2022, you may still experience some sticker shock—sorry—supermarket scaries.
Some grocery staples could still see outlandish price hikes. Beef, for example, already a pricier grocery item, will likely increase in the near future due to a shrinking supply of cattle across the country, according to a report in the Wall Street Journal. Drought, the pandemic, and cost increases has brought “the number of cattle in the US to its lowest level in nearly a decade,” the report says. Disease and hurricanes have hurt the orange crop in Florida, so oranges and orange juice will likely continue to get even more expensive than the 17.5 percent hike we’ve seen this year. Unusual weather has also hurt the peach crop, so expect to pay about 25 percent more there as well, Lee Dickey, a farmer in Georgia, told The Takeout.
Grocery inflation will probably start feeling less exorbitant next year at the earliest
It’s impossible to predict how grocery prices will shake out with 100 percent accuracy. Extreme climate events like drought can always pop up and make prices go haywire. But Bradley Rickard, a professor of food and agricultural economics at Cornell, notes that we’re seeing grocery price hikes slow as the factors that pushed them higher relax—like livestock diseases, and overall inflation. “We’ve started to see, more recently, a relaxation in most of these pressures on cost: machinery, fuel, labor, and cost of feed, in the case of animal products,” he says. “And so we’re starting to see these new prices, most noticeably for eggs, fall.” Data from the Bureau of Labor Statistics shows the average price of a dozen eggs was $2.67 in May, down from $4.82 in January.
The USDA predicts we’ll see an overall price raise of 6.3 percent in 2023—higher than average, but not as bad as the more than 11 percent increases we saw last year. Rickard suggests we might return to a more normal price increase rate of approximately 3 percent in 2024 or 2025. Is there an immediate solution in the meantime? Perhaps not—though may we humbly suggest Grocery Outlet Bargain Market?
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