Bacon, eggs and bread are fetching higher prices at the grocery store, according to the American Farm Bureau Federation's latest Semi-Annual Marketbasket Survey, conducted last month.
A total of 89 shoppers in 27 states participated in the survey. It shows the total cost of 16 food items that can be used to prepare one or more meals was $53.27, up $1.73 or about 3.5% compared to a survey conducted a year ago. Of the 16 items surveyed, 10 increased, five decreased and one remained the same in average price.
"Several typical breakfast items increased in price, accounting for much of the modest increase in the marketbasket," said John Anderson, AFBF's deputy chief economist. "The 3.5% increase shown by our survey tracks closely with Agriculture Department's forecast of 2.5% to 3.5% food inflation for 2014," he said.
Items showing retail price increases from a year ago included bacon, up 12% to $4.80 per pound; ground chuck, up 10% to $4.10 per pound; white bread, up 10% to $1.81 for a 20-ounce loaf; sirloin tip roast, up 9% to $5.03 per pound; eggs, up 8% to $1.98 per dozen; whole milk, up 6% to $3.68 per gallon; chicken breasts, up 6% to $3.51 per pound; flour, up 5% to $2.76 for a 5-pound bag; toasted oat cereal, up less than 1% to $2.93 for a 9-ounce box; and Russet potatoes, up less than one-half of 1% to $2.70 for a 5-pound bag.
These items showed modest retail price decreases: bagged salad, down 4% to $2.61 per pound; deli ham, down 3% to $5.21 per pound; apples, down 3% to $1.59 per pound; vegetable oil, down 2% to $2.85 for a 32-ounce bottle; and orange juice, down 1% to $3.24 per half-gallon.
Shredded cheddar cheese remained the same in price compared to a year ago, at $4.47 per pound.
Price checks of alternative milk and egg choices not included in the overall marketbasket survey average revealed the following: 1/2 gallon regular milk, $2.46; 1/2 gallon rBST-free milk, $3.87; 1/2 gallon organic milk, $3.97; and 1 dozen "cage-free" eggs, $3.33.
Easter egg availability is strong
Although retail egg prices are historically high at $1.98 per dozen, consumers will find an adequate supply of the protein powerhouses to fill Easter baskets and for Passover meals, according to John Anderson, deputy chief economist at the American Farm Bureau Federation.
Further, "Eggs remain a relatively low-cost source of protein at a time when other meat and dairy product prices are also up," Anderson said.
Recently, global demand for eggs has been very strong. In 2013, U.S. egg exports were up by 39% compared to the prior year. Much of the increase was due to an increase in exports to Mexico, which in addition to having strong consumer demand, has also had its domestic egg supply reduced by an avian influenza outbreak that began in early 2012.
"U.S. poultry farmers are working to catch up with the surge in demand. U.S. table egg production has increased in each of the past three years and is expected to increase by another 1.5% again this year. Demand remains strong, but exports to Mexico will begin to taper off as that country rebuilds its domestic poultry industry," Anderson concluded.
On par with trends
The year-to-year direction of the marketbasket survey tracks closely with the federal government's Consumer Price Index 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.
"Through 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 about 16%, according to the Agriculture Department's revised Food Dollar Series," Anderson said.
Using the "food at home and away from home" percentage across-the-board, the farmer's share of this $53.27 marketbasket would be $8.52.
According to USDA, Americans spend just under 10% of their disposable annual income on food, the lowest average of any country in the world.