Page added on June 17, 2007
Rising gasoline prices have been getting all the attention, but the cost of another, more-important staple is actually rising even more: food.
In the past year, food prices have increased 3.7 percent and are on track to jump by as much as 7 percent by year’s end. The current increase is more than double the 1.8 percent jump seen the year before, according to the consumer price index.
…While food prices are rising pretty much across the board, items related to corn are affected the most. That’s because increasing demand for ethanol, made from corn, is driving up the price of corn, which farmers use to feed their poultry and cattle. The high price of corn is also affecting prices of everything from cereal and other products with corn as an ingredient to the oils used to make potato chips.
But corn is only one culprit. Higher labor, packaging and fuel costs all play a role. Bad weather in California and Florida was the main contributor to a 20 percent spike in citrus fruit prices as well as higher prices for some vegetables. A drought this summer could cause prices to rise even more than current projections.
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