People are making adjustments in order to stretch their dollars, but will that be enough?
Since March 2007, according to the Bureau of Labor Statistics, the price of eggs has jumped 35 percent. A gallon of milk is up 23 percent. A loaf of white bread has climbed 16 percent. And a pound of ground chuck is up 8 percent. Overall, U.S. food prices in 2008 are expected to rise 4 to 5 percent, about double the increases of recent years. And while the total rise is far less drastic than elsewhere around the world, the sharp hike for staples means everyone is feeling the pinch.
“We are in shocking new territory,” said Todd Hale, senior vice president of consumer shopping and insights at Nielsen Consumer Panel Services. “With the exception of the very affluent, everyone is looking to save by altering where they shop, how they shop and the brands they buy.”
Now, I suppose that I should feel somewhat greatful that I don’t spend a larger portion of my income on food, like the 70% that someone from Bangladesh would spend. But, when I am feeding my family and my kids friends (I will not turn away a young person), it gets quite expensive, that it sure feels like I am spending 70% of our income on food.
The drumbeat of ominous headlines is also alarming. U.N. Secretary General Ban Ki-moon said in Geneva on Tuesday that he would set up a task force to tackle rising food prices in an attempt to avert “social unrest on an unprecedented scale.” President Bush has freed up $240 million in food aid to meet emergency needs around the world, bringing the total U.S. contribution since October to $1.36 billion. Members of Congress and even Secretary of State Condoleezza Rice are starting to question whether ethanol mandates, which have been linked to rising prices, are the best answer to America’s reliance on imported oil. Today, Sen. Charles E. Schumer (D-N.Y.) will hold the first congressional hearing on how skyrocketing food prices are affecting American families.
“You used to hear people talking about increases on specific items; now it’s much more broad,” Schumer said. “When you go down the street now, you hear people complaining about food prices almost as much as gas prices.”
Now, I haven’t delved that much into the food price linked to ethanol (as an aside, FT has a section on the global food crisis), but I think Condi is raising a false flag, except there might be a thread of truth, as a lot of the foods we in the US buy are processed and need tons of oil to be produced.
For a large portion of us, instead of clipping coupons and going from store to store to get the “best” price, we should be looking at buying direct from farmers — buy locally. If you check out this last link, you’ll even find a section to help you shop and cook.
The thing is, the less processed cheap foods we buy and consume, the healthier we (and our families) are.
