Food inflation is skyrocketing on record input costs and supply and demand issues. American Farm Bureau President Zippy Duvall states the obvious: “All of us are feeling the pain of higher prices at the grocery store.”
But AFBF Economist Bernt Nelson says the latest August USDA numbers show just much. Nelson; “All food prices were eleven, just shy of eleven-and-a-half percent higher than August of 2021.”
And looking ahead to Thanksgiving, turkey and egg prices impacted by demand and bird flu are rising even faster, with turkey prices hitting record levels.
Nelson said; “Fresh boneless, skinless Tom turkey breasts led the way, reaching as high as 6-dollars-70-cents per pound on September 17. That’s 112-percent higher than the same time in 2021. Now, the combined regional average price for a dozen grade A large eggs delivered to a warehouse, was 2-dollars-and-34-cents on September 17, 2022. This is 27 percent higher than the same time in 2021.”
But Nelson says record input costs mean farmers aren’t profiting from higher prices; “We’re seeing higher prices for feed, fertilizer, fuel and labor. And all of these things come together to impact the bottom line for the farmer.”
Fuel prices have come down in recent weeks and USDA just announced a $500 million effort to boost domestic fertilizer production. But as the Federal Reserve tries to tame 40-year high inflation with big interest rate hikes, the threat of recession poses another looming challenge for food producers.