Grocery prices continue to climb with the annual increase since last August being estimated to be 13.5%. This is the largest increase since 1979.
Some essential food categories have had increases in the double digits in the last year. Notably, Egg prices increased by 40%, Margarine by 38%, and flour by 23%.
The Agriculture Department has said that many different factors have led to this wide increase across the economy. These include supply chain disruptions, the high cost of energy and transportation as well as the increase in labor costs.
Large grade-A eggs have had one of the largest increases with the price reaching a record high of $3.12. This is an increase of 82.3% in the last year. As the Agriculture Department noted this in part has been caused by a bird flu outbreak which led to many egg-producing flocks being reduced.
As the department noted the outbreak affected “40 million birds, 189 commercial flocks, and 39 States.”
The prices in almost all food categories have also continued to increase despite the decline in energy and commodities prices elsewhere. This was something also noted by Jayson Lusk, professor and head of the Department of Agricultural Economics at Purdue University.
To explain this increase he said that one likely cause is the increase in the hourly wages caused by the labor shortage. In the past year, wages have increased by 6% to $24.39.
All of these have affected most aspects of the economy with Dow Jones dropping 300 points.
The USDA has also said that food price increases should reduce by the end of the year and will continue dropping well into 2023.