Food Prices on the Rise

Ephraim Leibtag, an economist with the USDA’s Research Service informed consumers on Monday that, “The price of food is going to rise as much as 4% this year.” This food price inflation is going to be the highest since 1990. The past two years the food price inflation has been 2.2 and 1.8 percent. Why is the price of food increasing? Since some consumers have adopted a high protein diet, the beef industry has seen an eleven percent increase. Dairy products have increased by eight percent. Due to the harsh weather the southern states have suffered this past hurricane season and which caused farmers to replant their crops, there has been a four percent increase in fresh vegetables. My question to you is, “How much more of our consumer income are we going to have to use to purchase food and is that food, fad or necessary?” Do we need all these high proteins diets on a daily basis or can we supplement our diets with seasonal items, such as fruits and nuts to get the most value for our food dollar or will we be at the mercy of producers and the premise of “what the market will stand?” If the demand for beef were to fall and the supply were to rise, the excess inventory would then become excess production and producers want to move excess inventory, especially if it is perishable. Smart shopping can hold the price we pay for our consumer good and an increase of 1.8 and 2.2 percent could carry through the year.