Food Prices on the Rise… Again

The most recent Consumer Price Index in February shows food prices rose 7.9 percent during the month. Scott Brown, an Associate Professor of Agricultural and Applied Economics at the University of Missouri Extension Service, says several factors are pushing prices higher.

”That's been a combination of factors that's been driving us to higher CPI for food. I will say higher prices for things like cattle, hogs, milk products, we can look at things like fats and oils as well, so, there are some farm level increases in prices, but we have to remind ourselves that things like energy costs, labor costs, have all been going up. That adds costs from the farm gate to the retail that, in some cases, are more important than what's been happening at the farm level in terms of where we sit with the CPI for food.”

“It has added costs from the farm level to the retail level. We have to get those products from the farm level, from the processor, all the way to the ultimate consumer, and I think that's added a lot of inflation in terms of what we're seeing on food prices. Beyond that, we can talk about higher wheat prices, so that's directly in things like what the loaf of bread costs but, longer-term, could continue to ramp up higher feed costs for livestock producers and make meat prices higher. On top of that, Ukraine is important in terms of being a big producer of global sunflower oil. When you look at the fats and oils component of the CPI for food in February, it was 11.7 percent above year-ago levels.”