Food prices good news for wallets
At least the recession has been good for something. One sizable household expense — the weekly grocery bill — is on average lower than it was in 2008.
This marks the first time since 1967 that the food-at-home component of the federal government’s Consumer Price Index has fallen over a 12-month period.
Declining meat, dairy and produce prices all helped push the cost of groceries down 2.8 percent in October from a year earlier. The cost of eating out, meanwhile, was up 2.2 percent during the same period.
Wegmans Food Markets Inc. in November 2008 cut prices on a number of products in response to the recession’s effect on household budgets and in anticipation that shoppers would increasingly be bargain hunting, said spokeswoman Jo Natale. Since then, she said, prices have dropped further due to declining fuel prices and lower commodity costs.
According to Wegmans, its average retail prices for beef are down 17 percent from a year ago, while pork and milk both are down 26 percent and cheese is 11 percent less expensive.
Federal reports for October, the most recent month available, generally bear out the Wegmans assertions, though some of the decreases are not as dramatic.
According to U.S. Department of Agriculture tracking, beef prices nationally fell in October for the 10th time in the past 12 months and were 6.7 percent below the year-earlier level. Pork prices were down 7.4 percent, the seventh drop in 10 months.
Meanwhile, in the produce section, according to federal figures, average fresh fruit in October was down 7.2 percent from a year earlier — with apples 18.2 percent cheaper — and fresh vegetable prices had fallen 8.3 percent.
Tops Markets LLC, a major rival to Wegmans in parts of upstate, including the Rochester area, said its prices have dropped substantially, too.
“Falling prices on dairy, meat and produce is, without a doubt, helping consumers stretch their dollars,” said Kate McKenna, a spokeswoman for Tops. “The price of goods is largely affected by transportation and commodity prices, which fluctuate regularly and are somewhat volatile. We constantly monitor and keep up with fuel, food and commodity prices … and we readily bring prices down when we see cost reductions by manufacturers.”
Becky Jones, 25, of Gates spends $60 to $70 a week on groceries for herself and husband, Nate, as she splits her time between Wegmans and the Aldi grocery chain. She acknowledged that she increasingly shops for bargains.
While grocery prices were rising at a fast clip last year, Jones said, the lack of increases this year — coupled with price declines for some items — has been a nice respite, she said.
According to the Agriculture Department, most of the cost savings were due to big drops in energy prices from mid-2008 through early 2009. But because oil prices have risen in recent months — crude oil has almost doubled to $77 a barrel since March — “overall consumer inflation should return to positive annual levels and put an end to the recent deflationary period,” a USDA analysis stated.
Wegmans couldn’t say what kind of pricing trends it expects to see in 2010.
“We don’t have a crystal ball,” Natale said. “We know where commodity prices are concerned, these things tend to be cyclical. But we don’t know what will happen.”
MDANEMAN@DemocratandChronicle.com
Half in, half out
Americans spent roughly $1.2 trillion on food in 2008, with nearly 49 percent of that spent on eating out, according to the U.S. Department of Agriculture.
