Retail food prices at the supermarket declined slightly during the second quarter of 2012 with protein staples—meats, cheese, milk and eggs—showing the greatest drops in price, according to the latest American Farm Bureau Federation Marketbasket Survey.
The informal survey shows the total cost of 16 food items that can be used to prepare one or more meals was $50.91, down $1.56 or about 3% compared to the first quarter of 2012. Of the 16 items surveyed, 12 decreased and four increased in average price compared to the prior quarter. The cost for the overall basket of foods fell about one-half of 1% compared to one year ago.
Most of the quarter-to-quarter decrease in the marketbasket of foods was due to lower retail prices for sliced meats and dairy products.
“The decline in retail meat prices for the second quarter is not unexpected,” said John Anderson, an AFBF senior economist. “Wholesale meat prices trended lower at the end of the first quarter of the year and consumers are benefiting from that as retail prices have followed suit.”
Two items continued declines from the prior quarter. Whole milk declined by 17 cents to $3.36 for one gallon and boneless chicken breasts decreased by 10 cents to $3.09 per pound.
Four items showed modest retail price increases: ground chuck increased 12 cents to $3.65 per pound; Russet potatoes increased 5 cents to $3.06 for a 5-pound bag; white bread increased 3 cents to $1.88 for a 20-ounce loaf; and vegetable oil increased 1 cent to $2.98 for a 32-ounce bottle.
Reversing increases in the prior quarter, shredded cheddar decreased 36 cents to $4.29 per pound; sliced deli ham decreased 19 cents to $5.24 per pound; orange juice decreased 19 cents to $3.17 for a half-gallon; bacon decreased 17 cents to $4.04 per pound; large eggs declined 16 cents to $1.61 per dozen; toasted oat cereal decreased 14 cents to $2.99 for a 9-ounce box; bagged salad decreased 11 cents to $2.74 per pound; apples decreased 9 cents to $1.50 per pound; sirloin tip roast decreased 6 cents to $4.69 per pound; and flour decreased 3 cents to $2.62 for a 5-pound bag.
Several items showing a decrease in retail price from quarter-to-quarter also showed year-to-year decreases. Dairy products were generally down year-to-year, reflecting the effects of increased dairy production this year. Bacon prices are also down from last summer’s record levels.
The year-to-year direction of the Marketbasket Survey tracks with the federal government’s Consumer Price Index (http://www.bls.gov/cpi/) report for food at home. As retail grocery prices have increased gradually over time, the share of the average food dollar that America’s farm and ranch families receive has dropped.
“Through the mid-1970s, farmers received about one-third of consumer retail food expenditures for food eaten at home and away from home, on average. Since then, that figure has decreased steadily and is now about 16%, according to the Agriculture Department’s revised Food Dollar Series,” Anderson said.
Using the “food at home and away from home percentage across-the-board, the farmer’s share of this quarter’s $50.91 Marketbasket would be $8.15.
According to USDA, Americans spend just under 10% of their disposable annual income on food, the lowest average of any country in the world. A total of 74 shoppers in 28 states participated in the latest survey, conducted in May.