Grocery prices with some exceptions, remain high, and could go even higher, according to the American Farm Bureau Federation. It’s sticker shock at the grocery store, and AFBF Economist Bernt Nelson says input costs and general inflation are among the main culprits.
“Across the board, with our grocery prices, we’re still seeing pressures from the high input costs that farmers face. That, combined with the inflationary pressures that are still hanging on, are giving us this scenario, where we’re still seeing some prices rise in the grocery stores.”
The Washington Post recently reported that grocery prices have jumped 25 percent in the last four years, outpacing overall inflation of 19 percent, with sharp jumps for beef, sugar and juice.
Nelson says egg prices have been more volatile as avian influenza took a toll on bird populations last year.
“They’ve come back down as we’ve seen these outbreaks kind of dial back, but we’re still seeing some supply issues, due to avian influenza that have kind of driven things back up in the $2, $2.20 average range.”
Nelson says beef prices are stable for now, but might hit record highs by next year, based on the lowest inventory of cattle and calves since 1951.
Higher processing plant and grocery store wages and post-pandemic shipping costs plus Russia’s war with Ukraine have also spiked food prices, including for grains and vegetable oils.
AFBF urges lawmakers to pass a farm bill.
“We need a farm bill to provide that safety net for when farmers end up in hard times. So, whether it be from a natural disaster, lower prices, higher input costs.”
Economist Nelson says whether it's high input costs or food security, a new farm bill can address both.