Politics

Grocery Prices Are Expected To Rise Another 3% Before End Of Year

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Grocery prices will rise by another three percent before the end of the year, according to one of America’s biggest supermarkets.

Cincinnati-based Kroger generated $132 billion in sales last year, but the company said inflation is running longer than management previously anticipated, altering their expectations for prices.

Bosses now say they predict prices will rise 2 to 3 percent over the second half of this year.

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It came as White House statistics last week revealed that a surge in meat prices is responsible for half of the price increase for food at home since December 2020.

Since December, prices for beef have risen by 14 percent, pork by 12 percent, and poultry by 6.6 percent.

Kroger will be ‘passing along higher cost to the customer where it makes sense to do so,’ CFO Gary Millerchip said on the company’s second-quarter earnings call on Friday.

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Management at Albertsons Companies – which operates 21 retail brands including Albertsons, Jewel-Osco and Safeway – reported an estimated revenue of $70 billion dollars in 2020 and expressed similar concerns that inflation would run hotter in the second half of this year.

They also said that they would have to raise prices on some of their products.

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Further prices on grocery items would add more pressure on consumers as they are already dealing with the biggest annual increase in consumer prices since August 2008.

The all-items Consumer Price Index (CPI), a measure of economy-wide inflation, has increased by 0.5 percent from June 2021 to July 2021 before seasonal adjustment, up 5.4 percent from July 2020.

The statistics for August’s CPI are expected to be released this week.

The CPI for all food increased 0.7 percent from June 2021 to July 2021, and food prices were 3.4 percent higher than in July 2020.

The food-away-from-home (restaurant purchases) CPI increased 0.8 percent in July 2021 and was 4.6 percent higher than July 2020.

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The food-at-home Consumer Price Index increased 0.6 percent from June 2021 to July 2021, contributing to a year round increase of 2.7 percent so far in 2021.

Red meat, including beef, veal and pork, as well as poultry are the items that will see the effects of soaring prices the most, if they haven’t already.

Beef and veal prices increased 0.5 percent from June to July 2021, pork prices increased 2.2 percent; and poultry prices increased 1.9 percent.

These increases follow five months of consecutive price increases for all three categories. Prices have been driven up by strong domestic and international demand, high feed costs, an… (Read more)