Food prices see historic upsurge
Pandemic disruptions affect one grocery aisle, then another
DES MOINES, Iowa — U.S. shoppers have seen the costs of meat, eggs and even potatoes soar as the coronavirus has disrupted processing plants and distribution networks.
Overall, the cost of food bought to eat at home skyrocketed by the most in 46 years, and analysts caution that meat prices in particular could remain high as slaughterhouses struggle to maintain production levels while implementing procedures intended to keep workers healthy.
While price spikes for staples such as eggs and flour have eased as consumer demand has leveled off, prices remain volatile for carrots, potatoes and other produce because of transportation issues and the health of workers who pick crops and work in processing plants.
In short, supermarket customers and restaurant owners shouldn’t expect prices to drop anytime soon.
Big fluctuations in food prices began in March, when the coronavirus pandemic began to sink in for U.S. consumers.
The Labor Department reports that the 2.6% jump in April food prices was the largest monthly increase in 46 years. Prices for meats, poultry, fish and eggs increased the most, rising 4.3%. Although the 2.9% jump in cereals and bakery products wasn’t as steep, it was still the largest increase the agency has recorded.
Dairy and related products, fruits and vegetables increased by 1.5 percent in April.
Egg prices also reached an all-time record of more than $3 a dozen in late March, but they have since fallen to less than $1 a dozen.
The situation has been worse for meat prices, largely because of illnesses among slaughterhouse workers. The outbreaks struck pork processing plants the hardest, but beef and chicken processors also saw some impact as thousands of workers tested positive for the virus and the United Food and Commercial Workers union said at least 44 workers had died of covid-19 as of Friday.
April retail prices for boneless pork chops and ham were nearly 6% higher than in March and retail prices for hamburger and sirloin steak were about 4% higher, the U.S. Department of Agriculture reported. The price of whole fresh chickens rose by more than 12%.
After numerous closures, most pork plants have reopened but often not at full capacity, forcing pig farmers to euthanize animals that couldn’t be processed.
“There are biological constraints to this, and that’s why I would anticipate prices to stay high at least for some period of time,” said Trey Malone, an agriculture economist and professor at Michigan State University. “If you’re going to euthanize thousands of animals and it takes six months to raise a new one, obviously there’s going to be some type of delay or buffer in the supply chain.”
By mid-May, beef and pork slaughterhouses were operating at about 60% capacity, though that figure has since climbed to nearly 90%, said Jayson Lusk, an economist at Purdue University.
Some grocery price jumps were because of people stocking up when the coronavirus first arrived. But even as some prices have dropped, the cost of produce such as potatoes, onions and carrots has remained above last year’s prices.
Jeff Dunn, CEO of Bolthouse Farms, a major provider of carrots and distributor of salad dressings and fruit and vegetable-based beverages, said he doesn’t anticipate new supply problems. But he noted that some of his company’s workers in distribution and field work have gotten sick, and that there is an additional cost to implement and maintain procedures intended to keep workers safe.
It’s also a tough time for livestock farmers, who had hoped that after some down years, they would benefit from new trade deals and a strong domestic economy.
“Farmers thought they saw the light at the end of the tunnel,” Lusk said. “It turns out that it was the headlight of a train.”