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U.S. consumers endure another round of food inflation. (Photo by 青 晨, Unsplash) |
It's déjà vu for American food costs. The price of eggs and other grocery items are increasing while American consumers face another soul-crushing round of food inflation. U.S. grocery costs "increased 1.8% from a year earlier in December, rising at the fastest pace in more than a year," report Patrick Thomas and Jesse Newman of The Wall Street Journal. "The cost of food overall was 0.3% higher in December, after increasing 0.4% in November."
Why this is happening -- again? "There isn’t one factor. Bird flu is killing chickens, cutting egg supplies and sending wholesale prices to a record," Thomas and Newman explain. "Extreme heat and dry weather in the world’s coffee-growing regions have sent the cost of brews surging. Chocolate and cereal makers have raised prices for their products, too."
It's a problem. "Consumers are still acclimating to a stretch of bruising inflation following the Covid-19 pandemic," the Journal reports. "Grocery prices in December were roughly 28% higher than they were five years ago."
While on the campaign trail, President Donald Trump promised to put a lid on grocery prices -- a promise that could prove difficult to deliver. "Some of the problems underlying food costs, such as disease and bad weather, don’t have quick policy fixes," Thomas and Newman add.
Even as egg prices climb, some egg producers are making hefty profits. "The index for eggs was up 37% from a year ago, and the average retail price of a dozen large eggs increased nearly 14% to $4.15 in December," the Journal reports. "Price increases have helped increase the profits of egg companies, including Cal-Maine, the largest U.S. egg producer, whose stock has doubled over the past year."
The price of meat has also increased but experts predict meat prices will level out. On balance, cocoa and sugar prices have surged. Thomas and Newman write, "A candy company recently said it would raise its prices by 10%." When asked about food inflation, Mark Skogen, CEO of Wisconsin-based Festival Foods, told the Journal, "It just doesn’t end."
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