Cost of Food Over the Last Few Years
Over the past few years, the cost of many foods has continued to rise. Just since last September, food costs have gone up by an additional 0.3 percent. Before that, they rose by 0.4 percent in February 2014, the biggest hike since late 2011. These increases are affecting products like pork, beef, fresh produce, poultry, eggs and dairy, all common staples in American households.
This trend is hitting consumers in their wallets. While the price of food is rising, people's wages are increasing much more slowly. What's more, although the price of gasoline and natural gas have dropped sharply, the prices of electricity and housing have gone up substantially. This has done little to ease the financial burden of food costs on Americans. A number of situations are to blame for the recent price increases, some of which took months to begin affecting the market.
Beef prices, which average around $5.30 per pound, have been hit from multiple angles. Drought and the subsequent increase in feed prices have been the primary driving factor. Many cattle producers in the Midwest have had to cull their herds to control costs. In addition, as the wealth in other nations increases, these countries are importing US beef, driving up demand and pricing.
On top of all that, America's total cattle population stands at only 88 million, the least since the early 1950s. This was the result of the recession, which forced many cattle ranchers out of business. Beef would be significantly more expensive if stores hadn't absorbed most of the price increase. However, more of these retailers are beginning to pass on that cost to customers.
The situation with pork prices, averaging about $3.70 per pound, is partly affected by more people seeking beef alternatives. At the same time, pork producers are only now beginning to recover from a long struggle with a virus outbreak among pigs across the country. The virus wiped out nearly all piglets, cutting the national herd by almost ten percent.
Like pork, poultry prices have also been affected by people looking for cheaper alternatives to beef. Over the last year, prices have increased by nearly five percent. This trend has also extended to eggs.
Dairy prices have increased by roughly 35 percent at the wholesale level, and a gallon of milk now costs upwards of $3.50. This is primarily because of increased export to other countries, which is expected to cause further price increases for Americans.
Even fruit and vegetables haven't been immune from higher costs. Last year, California experienced abnormally low temperatures, which hurt production. In Florida, a citrus disease caused heavy damage to orange crops, and strawberries production languished under a drought.