If your Memorial Day grilling activities are limited to today, and you haven’t picked up your main grilling fare, get ready! Everyone else has likely already experienced some sticker shock regarding current pork prices. Prices have been increasing across most grocery aisles, but the meat aisle is seeing some of the largest jumps. Based on data from the Bureau of Economic Analysis, food prices (overall) are about 1% higher than last year. The price of beef and veal is up 3.3% from last year, while pork is up 4.8%.
A little inflation is not a bad thing, but an increase of 5% over the course of a year is not small. The cause is similar to what we saw earlier this year with an increase in the price of chicken wings before the Super Bowl. The meatpacking industry continues to face labor shortages while consumer demand for meat increases as the weather warms. The price increases are not just limited to the US. The United Nations' Food and Agriculture Organization (FAO) has reported seven consecutive months of increasing meat prices internationally. The price changes are shocking to many, including this food service supplier in Ohio:
I’ve been in this business 40-some years, and in all my years, I have never seen what’s going on right now. I have never seen prices like this. There are always ups and downs with price, but we’re not getting a whole lot of downs right now.
The impact is having spillover effects on other markets as well. Restaurants are not immune to higher food prices, but they are simultaneously dealing with labor issues that don’t seem fixable with higher pay. With states relaxing guidelines, there has been a sudden increase in the demand for food at restaurants instead of in grocery stores. This sudden shift has disrupted the transportation industry because the need for refrigerated trucks has shifted and trucks aren’t in the locations that need them the most. It’s all a part of a broader supply chain issue known as the “bullwhip effect.” Companies that had previously pulled back their operations are now trying to quickly scale back up to the original production level.
If you’ve ever been curious about plant-based products, price increases for beef and pork may be enough to push you and other marginal consumers toward trying something new this summer. It’s one of the few items that hasn’t reported a pandemic-induced shortage over the past year. Some economists, however, aren’t concerned about food price inflation and believe you shouldn’t be either. Grocery store spending increased 50% since last year, but prices only increased about 5%. The concern, however, is that the impact of these price increases heavily impacts low-income households, which spend a disproportionate share of their income on food. How to respond to this inequity is challenging given American’s persistent culture war over meat and the things we eat.
The average retail price for a pound of sliced bacon was $6.21 in April 2021 [Bureau of Labor Statistics]
The international food price index is at its highest level since May 2014 [FAO]
An estimated 17% of U.S. households purchased plant-based food in 2020 [Food Dive]
Households with the lowest 20% of income spend approximately 35% of their income on food [Choices Magazine]
Week 21 of the year is done and I have checked in a total of 27 books since January. This past week I finished Wonder after picking up a used copy at a really neat used bookstore in Harrisburg, PA a couple of weeks ago:
The book is about a young boy with a facial deformity who goes to school for the first time when he gets to 5th grade. The book has alternating narrators, which I love. They did turn the book into a movie in 2017, so perhaps I’ll squeeze in a film over the next few months as well.