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Americans are suffering sticker shock every time they go to the grocery store: They’re coping with the biggest increase in food prices since 1979 — not to mention shrinking package sizes.
The cost of what the government calls “food at home” jumped 1.4% in May — the fifth straight increase of 1% or more.
What’s worse, the cost of groceries has leaped almost 12% in the past year, based on the consumer price index.
Read: Rising rents, gas and food prices push U.S. inflation to 40-year high of 8.6%
Until the recent surge, the cost of food has been relatively stable for years. There were brief spikes in 2011, 2008 and 1996, but they didn’t last long.
And grocery prices barely rose during an eight-year stretch from 2012 to 2020.
The cost of almost everything has risen sharply in the past year:
- Eggs: 32.2%
- Chicken: 17.4%
- Milk: 15.9%
- Butter: 15.9%
- Coffee: 15.3%
- Fresh fish and shellfish: 13.1%
- Baby food: 12.9%
- Pork: 12.6%
- Beef: 10.2%
- Sugar: 9.3%
- Bread: 8.7%
- Fresh fruit: 8.5%
- Fresh vegetables: 6.4%
Is there any relief in sight? Not much, economists say.
The cost of grains such as wheat and corn have soared in the wake of the Russian invasion of Ukraine. They are two of the world’s largest producers of grains, and the problem caused by the war could persist into next year.
What’s more, food-producing companies are paying more for energy, packaging and other supplies they need to get their products on grocery-store shelves. Their labor costs are also rising.
Many companies have responded by shrinking package sizes so consumers won’t notice — pasta boxes at 15 ounces, coffee in 10-ounce packages, beer in 11.2 ounce bottles and so forth.
The combination of high food and gas prices is going to put more stress on American households and harm the economy unless inflation relents soon, but don’t count on it.
“The uncomfortable reality is that there are no signs of any relief from rising food and energy prices,” said Richard Moody, chief financial officer at Regions Financial.
