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Retail Food Prices Rise Four Percent

by 5m Editor
13 July 2007, at 8:41am

WASHINGTON, DC - Retail food prices increased slightly in the second quarter of 2007, says the latest American Farm Bureau Federation (AFBF) Market basket Survey.

AFBF, the nation’s largest general farm organisation, conducts an informal quarterly market basket survey to monitor retail food price trends. It's recent review shows that the total cost of 16 basic grocery items in the second quarter of 2007 was $42.95, up about four percent or $1.61 on the previous quarter.

Of the 16 items surveyed, 14 increased, one decreased and one stayed the same in average price and, compared to one year ago, the overall cost for the market basket was up about eight percent.

Regular whole milk showed the largest price increase, up 34 cents to $3.46 per gallon. Sirloin tip roast increased 27 cents to $3.99 per pound; pork chops increased 22 cents to $3.63 per pound; ground chuck increased 20 cents per pound to $2.85.

Other items that increased in price were: whole fryers, up 17 cents; apples, up 15 cents to $1.45 per pound; vegetable oil and bread, both up nine cents; mayonnaise, up eight cents to $3.43 for a 32-oz. jar; and regular eggs, up five cents to $1.56 per dozen. Russet potatoes dropped 12 cents to $2.34 for a 5-pound bag. Bacon stayed the same at $3.44 per pound.

“Consumers have no doubt noticed their food dollar stretched a little tighter lately,” said AFBF Economist Jim Sartwelle.

More expense

As energy costs have increased, it has become more expensive to process, package, and transport food items for retail sale. "In addition, soaring demand overseas for US dairy and meat products has reduced quantities available at home, resulting in retail price increases at the grocery store," added Mr Sartwelle.

But as retail grocery prices have gradually increased, the share of the average food dollar that America’s farm and ranch families receive has dropped.

“In the mid-1970s, farmers received about one-third of consumer retail food expenditures on average. That figure has decreased steadily over time and is now just 22 percent, according to Agriculture Department statistics,” said Mr Sartwelle.

Using that percentage across-the-board, the farmer’s share of this quarter’s $42.95 market basket total would be $9.45.

According to USDA statistics, Americans spend just under 10 percent of their disposable income on food annually, the lowest average of any country in the world. A total of 82 volunteer shoppers in 32 states participated in the latest survey, conducted during May.

5m Editor