Americans must plan for rising food costs this year

U.S. food prices are increasing faster than inflation. Checkout at the supermarket is getting more painful in the U.S. as demand rises globally for key goods used in food production. Source for this article – Global food inflation starting to hit U.S. grocery budgets harder by MoneyBlogNewz.

Prices of food increasing are an issue to deal with

There was a year-over-year increase of food inflation in January of 1.8 percent. The U.S. Consumer Price Index came out to state this. With the rising fuel prices and bad weather, the cost for many goods is increasing. The need is going up right along with it. So far, the impact of these factors has been most dramatic in meat prices. For example, due to tightening supplies, corn prices reached a 30-month high in January. Feeding livestock takes corn. That means it costs more to pay for livestock to live. More people in developing countries such as China and India want more meat too. In just the last five years, the export on beef in the U.S. has gone up 1.5 billion pounds.

Cost of food in U.S. average data

U.S. customers are bidding against people in other countries for a limited Global supply of meat. A year ago, the price for meat was down. In just that time, poultry prices have gone up 2 percent, beef went up 6 percent and pork went up 12 percent in cost. Throughout the world, other commodity costs are increasing. That means that other items bought at the store are becoming more expensive. There has been a huge increase in bread, milk and egg costs according to January CPI data. Cereal costs are climbing due to rising wheat costs, and coffee is at a premium because coffee bean prices jumped 77 percent last year. The 2011 expectations for pork are insane. There is anticipated to be a 10 percent increase in prices. Beef prices are anticipated to rise more than 7 percent. The cost of chicken should go up over 5 percent since Americans should be eating more chicken.

What the U.S. will be paying for food in the U.S.

The U.S. Department of Agriculture points out that a 3 to 4 percent increase in U.S. food prices is expected this year. U.S. lawmakers are trying to act like the food inflation doesn't affect Americans. Last week Federal Reserve Chairman Ben Bernanke told the Senate Banking Committee that effect of food inflation on consumers will be “temporary and relatively modest.”. Without considering food and energy costs in inflation, it was said that U.S. households spend 12 percent of income on fuel and food after taxes. The increases are adding up fast for consumers dealing with high unemployment and stagnant wage growth. About $33,000 a year was the 2008 average made by a taxpayer. Two decades ago, it was not that bad.

Citations

CNN Money

money.cnn.com/2011/03/08/news/economy/food_prices/index.htm” target=”_blank

Seeking Alpha

seekingalpha.com/article/256992-rising-prices-are-hitting-consumers-harder-than-the-fed-will-admit” target=”_blank

Agrimoney.com

agrimoney.com/news/meat—and-oil—to-lead-climb-in-us-food-prices–2903.html” target=”_blank