Farm Bureau survey shows increase in grocery store prices

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Published: Tuesday, 14 April 2015 20:54

INDIANAPOLIS - Higher retail prices for several foods, notably orange juice and three varieties of meat, resulted in an increase in Indiana Farm Bureau’s spring market basket survey.

The informal survey shows the total cost of 16 food items was $52.40, up $1.22 or 2 percent compared to the survey last fall – and up more than $4 and more than 8 percent compared to the survey conducted this same time last year.

This increase was despite the fact that farm income, particularly regarding grain prices, has been in decline for more than a year, noted Isabella Chism, Indiana Farm Bureau second vice president.

“Many people are under the impression that increases in grocery store prices are the result of higher on-farm prices. But that is often not the case, and this quarter’s survey is an example of that misconception,” explained Chism, who with her family farms near Kokomo.

Farm income from the sale of crops decreased by 9.3 percent from 2013 to 2014 and is expected to drop by nearly 8 percent from 2014 to 2015, according to the USDA’s Economic Research Service. Income from livestock rose by more than 14 percent from 2013 to 2014 but is expected to drop by nearly 5 percent from 2014 to 2015.

“Several meat items increased in price, accounting for much of the modest increase in the market basket,” noted John Anderson, deputy chief economist for the American Farm Bureau Federation.

Items showing retail price increases from last fall were:

• Deli ham, up $1.25 to $6.34 per pound.
• Ground chuck, up 24 cents to $4.46 per pound.
• Sirloin tip roast, up 15 cents to $5.57 per pound.
• Orange juice, up 43 cents to $3.67 per half-gallon.
• Eggs, up 24 cents to $2.10 per dozen.
• Flour, up 13 cents to $2.46 for a 5-pound bag.
• Apples, up 15 cents to $1.87 per pound.
• Bagged salad, up 9 cents to $1.95 per 1-pound bag.
• Vegetable oil, up 34 cents to $3 for a 32-ounce bottle.
• Toasted oat cereal, up 8 cents to $2.88 a 9-ounce box.
• White bread, up 15 cents to $1.53 per 20-ounce loaf.

These items showed retail price decreases compared to last fall:

• Bacon, down 89 cents to $3.96 per pound.
• Whole milk, down 44 cents to $2.81 per gallon.
• Shredded cheddar cheese, down 41 cents to $4.09 per pound.
• Potatoes, down 27 cents to $2.66 for a 5-pound bag.
• Boneless chicken breasts, down 5 cents to $3.05 per pound.

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 percent, 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 $52.40 market basket would be $8.38.

The INFB survey is part of a nationwide survey compiled by the American Farm Bureau Federation from data supplied by state Farm Bureaus. AFBF, the nation’s largest general farm organization, has been conducting the informal quarterly market basket survey of retail food price trends since 1989. The series includes a spring survey, summer cookout survey, fall survey and Thanksgiving survey. A total of 86 shoppers (14 of them from Indiana) in 29 states participated in the latest survey, conducted in March.

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.