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Farm Events: |
Farm News: WI Food Survey Shows Prices Are UpcommentsPosted: 10.04.2011
Retail food prices grew just over two percent during the third quarter of 2011 according to the Wisconsin Farm Bureau’s Marketbasket Survey. The informal survey shows the total cost of 16 food items that can be used to prepare one or more meals was $50.55. It marked an increase of $1.06 (2.1 percent) from the $49.49 Marketbasket price in June, and $5.26 (11.6 percent) from one year ago.
“Food prices continue to climb at the grocery store and there’s a bumper crop of reasons why,” said Casey Langan, Wisconsin Farm Bureau spokesman. “Strong global demand, weather extremes and high energy prices are all driving steady price growth for many food items.”
Of the 16 food items surveyed by Farm Bureau members, 10 increased in price compared to the second quarter of 2011. Eggs increased 26 cents (20 percent) to $1.53 per dozen.
“A number of factors have impacted egg prices,” Langan said. “Nationally the number of egg laying hens has dropped about 1 percent from a year ago. The price of corn used to feed hens has been high. Also, as we are getting into the baking season, demand for eggs traditionally goes up. The good news for consumers is that retailers will likely begin promotions for eggs in the near future.”
Red Delicious apples increased 23 cents (16 percent) to $1.63 per pound.
“The price for apples in Wisconsin is impacted by a lighter apple crop in Michigan, fewer apples in cold storage than the previous two years, and a strong export market,” Langan said. “In the nation of India alone, imports of U.S. apples have swelled from 1.2 million boxes to 2.2 million boxes in the last year.”
Bagged salad and shredded mild cheddar cheese were the other items that saw the largest percentage increases in price over the last three months.
* Bagged salad increased 33 cents (13 percent) to $2.82 per pound.
* Shredded mild cheddar cheese increased 70 cents (17 percent) to $4.67 per pound.
Most items showing an increase in retail price from quarter-to-quarter also showed year-to-year increases. Compared to one year ago, bagged salad increased 32 percent, Russet potatoes increased 28 percent, whole milk and shredded mild cheddar cheese were both up nearly 22 percent, apples increased 19 percent, flour was up 18 percent, and eggs increased 16 percent. The total average price for the 16 items was up 11.6 percent compared to one year ago.
“Global demand for meat and dairy products remains strong and continues to influence retail prices here in the U.S.,” said American Farm Bureau Economist John Anderson. “Many nations around the world rely on America to provide the food they need to improve their standard of living, particularly through the addition of protein to the diet. Strengthened demand for meats began in 2009, continued through 2010 and remains important as we look ahead to the close of 2011.”
Other factors also came into play.
“On-farm production costs for energy, fertilizer and fuel continue on an upward trend but those costs are largely borne by farmers and ranchers. But, in addition, after food leaves the farm or ranch, higher costs for transportation, marketing, processing and storage are added,” Anderson explained. “As long as these costs remain elevated, consumers will continue to feel it in the form of higher food prices at the supermarket.”
“At the beginning of 2011, a number of factors including growing demand pointed to continued increases in retail food prices, especially for meats. But there’s always a lag time as farmers and ranchers increase the size of their herds to meet higher demand,” Anderson explained. “Extreme weather conditions around the nation have further compounded the issue, diminishing production and further increasing costs.”
Cheerios, ground chuck, sirloin tip roast, sliced deli ham, boneless chicken breast and vegetable oil were the six items that saw modest reductions in price since the second quarter of 2011. The largest decrease was the price of boneless chicken breast falling by 34 cents (8 percent) to $3.67 per pound.
WISCONSIN PRICES LOWER THAN NATIONAL AVERAGE
Wisconsin’s $50.55 Marketbasket is $2.57 less than the American Farm Bureau Federation’s national survey of the same 16 food items. AFBF’s survey rang in at $53.12. Despite the lower overall price, five of the sixteen items recently surveyed in Wisconsin were higher than the national average: bagged salad, whole milk, bacon, ground chuck and boneless chicken breast. Ground chuck cost just one penny more in Wisconsin than the national average.
FARMER’S SHARE IS JUST $8.08
Over the last three decades retail grocery prices have gradually increased while the share of the average dollar spent on food that farm families receive has dropped. In the mid-1970s, farmers received about one-third of consumer retail food expenditures in grocery stores and restaurants. Since then that figure has decreased steadily and is now about 16 percent, according to the U.S. Department of Agriculture’s revised Food Dollar Series. Using that percentage across the board, the farmer’s share of this quarter’s $50.55 grocery bill would be $8.08.
Despite higher prices, the USDA says Americans will still spend approximately 10 percent of their disposable annual income on food, the lowest average in the world.
The Marketbasket Survey is a quarterly look at the trends in food prices in Wisconsin in relation to changing farm prices, weather and wholesale and retail food marketing. Members of the Wisconsin Farm Bureau collected price samples of 16 basic food items in 19 communities across Wisconsin in September.
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