Why food prices are rising – and how to save money on groceries

If you suspect your grocery bill is getting pricier, it’s not your imagination.

The cost of nearly everything that contributes to your food budget is increasing – entire categories of food, packaging and transportation. This makes it more expensive to put food on the table every day, not to mention hosting festive gatherings during the holidays.

The big picture: The consumer price index for all food increased 4.5 percent in September over the previous September and 0.8 percent from August to September this year.

Reasons vary. Heat and drought are ramping up the cost of produce. Shortages of corn and soybeans have driven up the price of meat, which has risen the most during the past year, compared to other food. Lack of staffing and unpredictable, more expensive transportation have delayed production and delivery of produce, and in turn, led to a hike in costs.

Hurricanes have shut down refineries, reducing the availability of sweeteners. A shortage of wood at mills has driven up the cost of pallets used in shipping. Aluminum prices are higher than at any time in the past 10 years, which makes packaging pricier.

Higher food prices are worse for people already experiencing hunger – 38 million Americans are food insecure, about one in 10 households. That number has soared during the pandemic. More than one in four Americans are worried about having enough money to pay for their food, according to an industry survey, and more than half worry about food inflation.

Those who live in poverty have been hit the hardest. The survey found that more than a third of households below the federal poverty line are food insecure.

Some people of color are disproportionately affected, too. For instance, those living in homes with Black or Latino heads of household are more likely to experience food insecurity.

The ongoing problem of some people never having enough food to eat is the result of long-running gaps in federal social spending plans, such as SNAP, better known as food stamps. It should not be up to individuals to find solutions to the problem of food being expensive. Difficulty putting food on the table isn’t a problem individuals should have to bear the burden of solving.

A big part of the solution to widespread food insecurity rests with policymakers and regulators. We need better policies to tackle the longstanding and widespread problem of food insecurity.  

But until policymakers act, there are steps consumers can take to make the best of a tough situation.

Keeping a lid on rising food prices

If you’re struggling to pay for groceries, or would just like to trim your grocery budget, consider these ideas.

Plan the week’s menus and create a shopping list. You’re more likely to buy only what you need if you go to the store with a list.

Pay attention to store deals. In addition to cutting coupons, you can watch for store discounts and membership programs. They are more likely to offer deals later in the month.

Buy in bulk. Shopping at warehouse stores or stocking up when there is a sale can help cut costs. To make sure you get notified about sales, you can opt in for notifications on a store’s app, sign up for the store’s mailing list, or speak to someone in customer service.

Try new sources of protein. The cost of animal-based protein has gone up more than many other foods – beef is up 20 percent, and pork is up 14 percent. Beans and lentils are inexpensive and healthy, better for you and the environment than animal-based sources of protein.

Eat in. The costs of groceries and dining in restaurants are rising. Eating at home is less costly than eating in a restaurant or even a fast food eatery. Save eating out for special occasions and make most of your meals at home. Look online for dish suggestions that are easy to prepare and don’t require lots of ingredients but will spark your creativity.

Stock up on produce. The availability of fruits and vegetables has been affected less by the events of the past year than some other food categories. But crops have been harmed by drought, heat and severe weather events like hurricanes, all made worse by the climate crisis. That’s why it can be wise to stock up now on these items before they become scarce.

Eat fewer processed foods. The cost of processed and packaged foods has been especially affected by pandemic-related shortages. Unless they are organic, packaged and processed foods are also more likely to contain less healthy ingredients, such as food additives that haven’t had safety reviews by the Food and Drug Administration.

Consider store-brand products. When you do buy processed or packaged food, check out store brands, which are typically less expensive than name brands. Check ingredients labels to make sure the food doesn’t contain harmful ingredients. You can also consult our Food Scores database that ranks food based on ingredient, nutrition and processing concerns.

Get help. Visits to food pantries increased in 2020, according to the Department of Agriculture. A food bank in Washington, D.C., reports that two-thirds of people responding to a recent survey had visited a food bank for the first time during the pandemic.

It's important to understand and confront rising food prices. President Joe Biden’s Build Back Better Act is a $1.75 trillion social spending plan that contains $10 billion in funding for child nutrition programs that can help ensure children and families have access to the nutrition and food that they need.

These programs have been shown to reduce food insecurity and help families make ends meet by providing free or reduced-price school meals year-round and expanding eligibility to families in need.

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