As Americans complete their Thanksgiving grocery shopping, they can expect a big helping of inflation on their plates throughout the holidays.
The consumer price index rose at a 7.7% annual rate in the October inflation report, but most concerning to America’s home chefs: Food prices were up 11% from last year when inflation was already hitting uncomfortable levels.
Last week, the American Farm Bureau Federation’s 37th annual Thanksgiving dinner cost survey showed prices have jumped 20% based its volunteer shoppers’ reporting. That’s on top of the 14% the shoppers’ sleuthing found last year.
In the producer price index, which rose 10.3% in October, turkeys were more than triple the index: up 32%. Turkey prices jumped 20% from October 2021.
Those increases showed up in our shopping carts in October, according to the CPI. In the American Farm Bureau survey, the average price for 16-pound bird rose 21% to $28.96, $1.81 per pound.
September’s inflation report listed four dozen items with “largest ever” annual increases since the Bureau of Labor Statistics started tracking them. Most of the items are indexed to the early ’80s; some go back further.
Most important for grocery shoppers: Twenty of those largest-ever increases were foods or food categories. Looking at that same basket in October, all but one had a double-digit increase from last year and eight had new “largest ever” increases in October.
One of the biggest annual increases in the October report showed up in the fats and oils section, which rose 23%.
Driving much of the much of the change: butter, up 27%, and margarine, up 47%. Combined they rose 34%.
CNBC did a deep dive into the phenomenon that largely leads back to Russia’s invasion of Ukraine (a major producer of sunflower oil), drought in Canada (canola oil) and other weather conditions in Brazil (soybeans).
Vegetable oils are a key component of margarine, so with oil prices rising because of shortages driven by global events, the spread incurred its largest increase since April 1975.
Tighter milk supplies and rising production costs account for much of butter’s rise. Producer raw milk costs were up 28% annually in September.
In stores, American Farm Bureau shoppers found a gallon of whole milk rose 16% to $3.84 while a half pint of whipping cream is up 26% to $2.24.
You name the food: It was higher in October than it was last year, and most of those increases were double-digit. Meat and fish were notable exceptions, but many beef and pork categories were some of the first to signal the rapid rise in inflation last year.
The American Farm Bureau survey found 3 pounds of sweet potatoes rose 11% to $3.96, while a 5-pound bag of russet potatoes is up 23% to $3.64. Both saw single-digit increases last year.
The CPI report isn’t that detailed, but the 15% annual increase in October suggests we’ll be paying more again this year for all kinds of potatoes.