WASHINGTON, D.C., July 8, 2010 – Retail food prices at the supermarket increased slightly during the second quarter of 2010, according to the latest American Farm Bureau Federation Marketbasket Survey. The informal survey shows the total cost of 16 food items that can be used to prepare one or more meals was $47.20, up $1.66 or 4 percent compared to the first quarter of 2010. The total average price for the 16 items increased about 2 percent compared to one year ago. Of the 16 items surveyed, nine increased and seven decreased in average price compared to the prior quarter.
Sirloin tip roast, sliced deli ham, bacon, boneless chicken breasts and ground chuck increased the most in dollar value since the first quarter.
Sirloin tip roast and sliced deli ham increased 41 cents to $4.10 and $5.24 per pound, respectively; bacon increased 33 cents to $3.53 per pound; boneless chicken breasts increased 32 cents to $3.25 per pound; and ground chuck increased 26 cents to $2.89 per pound.
“Consumers are paying a bit more for most meats at the grocery store on average this quarter,” said AFBF Economist John Anderson. “As livestock producers of all types have reduced the size of their herds, wholesale meat supplies have tightened up, which is now affecting consumers.”
Other items that increased in price since the first quarter were bagged salad, up 13 cents to $2.80 for a 1-pound bag; flour, up 9 cents to $2.35 for a 5-pound bag; bread, up 5 cents to $1.76 for a 20-ounce loaf; and orange juice, up 2 cents for a half-gallon to $3.00.
Compared to a year ago, eggs increased 14 percent; bacon increased 11 percent and sliced deli ham increased 9 percent.
Seven foods dropped in price compared to the prior quarter: Russet potatoes, down 25 cents to $2.51 for a 5-pound bag; eggs, down 21 cents to $1.53 per dozen; vegetable oil, down 13 cents to $2.61 for a 32-oz. bottle; shredded cheddar cheese, down 10 cents to $4.16 for one pound; whole milk, down 9 cents to $3.06 per gallon; apples, down 4 cents to $1.46 per pound; and toasted oat cereal, down 2 cents to $2.95 for a 9-oz. box.
Of the items showing a decrease in retail price this quarter, several also showed year-to-year declines – potatoes, 9 percent; vegetable oil, 8 percent; shredded cheddar cheese, 3 percent; and flour, 3 percent.
“The economic recovery continues to be very slow,” Anderson said. “Where retail food prices will head in the next quarter or two is uncertain and depends to some degree on whether or not consumer confidence remains soft or begins a strong rebound.”
The year-to-year direction of the marketbasket survey tracks with the federal government’s Consumer Price Index (www.bls.gov/cpi) report for food at home. As retail grocery prices have increased gradually over time, the share of the average food dollar that America’s farm and ranch families receive has dropped.
“Beginning in the mid-1970s, farmers received about one-third of consumer retail food expenditures for food eaten at home and away from home, on average. Since then, that figure has decreased steadily and is now just 19 percent, according to Agriculture Department statistics,” Anderson said.
Using the “food at home and away from home” percentage across-the-board, the farmer’s share of this quarter’s $47.20 marketbasket would be $8.97.
AFBF, the nation’s largest general farm organization, has been conducting the informal quarterly marketbasket survey of retail food price trends since 1989. The mix of foods in the marketbasket was updated during the first quarter of 2008.
According to USDA, Americans spend just under 10 percent of their disposable annual income on food, the lowest average of any country in the world. A total of 85 shoppers in 32 states participated in the latest survey, conducted in May.
Tracking Milk and Egg Trends
For the second quarter of 2010, shoppers reported the average price for a half-gallon of regular whole milk was $2.06, up 6 cents from the prior quarter. The average price for one gallon of regular whole milk was $3.06, down 9 cents. Comparing per-quart prices, the retail price for whole milk sold in gallon containers was about 25 percent lower compared to half-gallon containers, a typical volume discount long employed by retailers.
The average price for a half-gallon of rBST-free milk was $3.38, down 24 cents from the last quarter, about 65 percent higher than the reported retail price for a half-gallon of regular milk ($2.06).
The average price for a half-gallon of organic milk was $3.65, down 1 cent compared to the first quarter of 2010 – about 80 percent higher than the reported retail price for a half-gallon of regular milk ($2.06).
Compared to a year ago (second quarter of 2009), the retail price for regular milk in gallon containers was down about 2 percent while regular milk in half-gallon containers increased 8 percent. The average retail price for rBST-free milk increased about 6 percent in a year’s time. The average retail price for organic milk in half-gallon containers was virtually unchanged compared to the prior year.
For the second quarter of 2010, the average price for one dozen regular eggs was $1.53. The average price for a dozen “cage-free” eggs was $2.91, about 90 percent more than regular eggs. Compared to a year ago (second quarter of 2009), regular eggs increased 14 percent while “cage-free” eggs decreased 3 percent.
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