Grocery prices are on the rise

With so many people cooking nearly every meal at home, it is not surprising that we are spending more on groceries. But that higher total you see on your store receipt is not only due to making more food at home, the prices of groceries are going up. The increase in the cost of supermarket staples like milk, bread, and meat jumped 2.6 in April, the largest single month increase since February 1974.

The cost of eggs went up a whopping 16.1%, while the price of bakery items (which includes cereals) increased 2.9%. That is the biggest one-month leap in over 100 years. No one will be surprised to learn that coronavirus issues are driving these price increases. These include disruptions to the food supply chain and increased demand for ingredients because of restaurant closures. The supply chain disruptions are driven by the closures of beef and pork processing plants due to Covid-19 outbreaks.

Some states are beginning to relax stay-at-home rules and allow restaurants to reopen, although sometimes not at full capacity. Because of this, analysts believe it will probably take a few more months before the effects on grocery prices stabilize. David Henkes, a senior principal at food service research firm Technomic, agrees, saying that “each of these manufacturers and distributors needs to figure out how to start re-servicing restaurants and other food service establishments as they start to come back online, all of which will have an impact on supply, demand and ultimately pricing.”