Inflation Is Cooling, but Grocery Bills Will Likely Get More Expensive This Year
The prices of certain food items are expected to soar in 2023
Inflation was at a nearly 40-year high during the past year, but it’s thankfully starting to come down. According to MarketWatch, the inflation rate fell to an annualized 6.5% in December, which was down from 7.1% in November. But even though general inflation is beginning to ease, factors outside of the Federal Reserve’s control are making food prices even more expensive.
Avian flu continues to affect our supply of eggs, and the ongoing extreme weather conditions make growing seasons unpredictable, complicating food production. Additionally, the war in Ukraine is impacting the prices of fertilizers and animal feeds.
The weekly supply of eggs has reached a historic low, which is making your morning omelet significantly more expensive. Avian flu has killed millions of chickens, and the holiday season is a big time for egg shopping, which is why the price is likely so high right now. On average, a dozen eggs have more than doubled in price — the cost of a carton reached $4.25 in December, compared to $1.79 a year earlier.
That stick of butter is also more expensive these days. Nationally, the average price of a pound of butter was $4.81 in December, up 31.4% from the year before. Extreme heat and smaller cow herds can be attributed to that jump, as cows eat less and produce smaller amounts of milk when it’s hot. Butter is also competing with cheese consumption, which is growing between 1-2% each year.
Finally, vegetable oil and margarine prices are also expected to increase in 2023. The price of margarine rose 43.8% in December. Oils made from soybeans, corn and sunflower seeds are being affected by the war in Ukraine, but a big quantity of vegetable oil is also being used to produce renewable fuel. But global supplies of wheat, corn and soybeans are predicted to decline for the fifth consecutive year, which means your frying oil is probably going to get pricier.
Even though some food prices are expected to rise, you can save at the grocery store with these few handy tips this year.
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