Coping With High Food Prices

This summer I noticed that many of the grocery products I buy skyrocketed in price, downsized in volume, or both. Blame oil prices for transportation hikes or the sinking of the American dollar or whatever. We’re all paying for it.

Photo of three jars of peanut butter side-by-side in this order left-to-right: a Reduced Fat Skippy, a Reduced Fat Jif and a Reduced Fat Skippy. The two Skippy jars look nearly identical. Nearly.

One of these things is not like the other. That’s correct, the Skippy jar on the right has been redesigned to sell you less
peanut butter for the same price. This summer Skippy downsized its
jars, this one from 18 oz. to 16.3 oz.

And if you buy Skippy Natural (not pictured) you’ll get the 16.3 oz.
jar, but with only 15 oz. of peanut butter. Compare volume sizes before
buying, and look on store price tags because they often report your
per-ounce cost.

Close-up photo of the ounce listing on three jars of peanut butter. A Jif jar contains 18 ounces. An old-style Skippy jar contains 18 ounces. A new-style Skippy jar contains 16.3 ounces.

When I thought about this subject, Brett Levy came to mind. He’s the blogger behind DadTalk. When he’s not writing about his two kids Seth and Lael, he’s taking a look at big picture economic and societal issues. I asked him to write a guest article about food prices. Somehow, between moving his family across the country and acclimating to the insane heat that is known as Arizona, he found time to say…




While waiting for Seth to get out of school, I asked a couple moms, "Do
you notice anything different at Whole Foods?"

"Yes, the produce isn’t as fresh," complained one mom.
"Perhaps it’s sitting on the shelves longer?"

"Uh, their prices," answered another. "We don’t
go their as much."

A few days later, I was at the Scottsdale-Phoenix Smart & Final, a
Western chain that sells cleaning, restaurant and bulk food supplies at low
cost. When we lived in California,
I would load up on toilet paper, paper towels, tissues and a few other items
like water and healthy snacks. The store there often was frequented by
restaurant owners and janitors.

But in the spic-and-span Scottsdale Smart & Final, well-dressed
moms and dads pulled up in the largest SUVs I’ve ever seen. After listening
to some conversations and talking to one parent, I discovered they were newbies
at the chain.

I soon discovered Americans are increasingly turning to discount
retailers to cope with rising food prices. Both Sam’s Club and Costco
experienced a large increase of shoppers from September 2006 to April, reports The New York Times. Almost 12 percent of the new shoppers had incomes above
$75,000.

Aldi, a food store that emphasizes no frills and limited product selection,
is also seeing a surge in traffic, reports The New York Times. Despite the stores’ narrow aisles, limited choices and
lack of traditional shelving, shoppers have been spending far less at Aldi
stores for decades. (My mom occasionally shopped at the stores when I was
growing up in the Chicago
area. Sadly, there are no stores in Arizona.)

Before you sniff, "I never heard of Aldi," you should know
that this German company owns Trader Joe’s and is responsible for that chain’s
relatively low prices.

For parents hoping that a recent decline in oil and commodity prices will
provide relief, think again, reports another New York Times story. Many companies are keeping prices high to offset losses
earlier this year.

Pricing is not the only way food manufacturers are squeezing consumers.
Some companies are shrinking package sizes, reports the Canadian
Press
:

"Skippy peanut butter, made by Unilever, now sells in
16.3-ounce jars that look the same size as the previous 18-ounce jars because
of a larger indentation at the bottom. Kraft is reducing the number and in some
cases the size of items in one of its cheese lines, for example. Sara Lee has
reduced the size of some of its deli meat packages from 10 ounces to nine
ounces. The prices, for the most part, don’t go down."

This is happening even as retail food prices increased an average of 6
percent this year. More from the Canadian Press:

"These rising food costs have to be paid for by
somebody," he said. "The question is how are you going to pay for
them? Are you going to pay for them in keeping your out-of-pocket cost constant
by buying smaller portions, or are you going to be paying more for what you
paid last year?"

School lunches are especially hard hit. In the Albany, N.Y.,
area, school lunches are expected to rise by up to 18 percent, reports the Times-Union.
Other regions have also reported increases.

High food prices are even worrying health care experts, reports The Wal Street Journal. That’s because Americans with chronic conditions,
such as diabetes, are hard pressed to pay for the high-quality food they need:

"Fruits and vegetables are by definition
becoming luxury goods," says Adam Drewnowski, director of the University of Washington Center for Obesity Research.
In a study released last December, he found that the prices of some healthy
foods in Seattle-area grocery stores had jumped 16% between 2004 and 2006,
while less-nutritious items had gone up only gradually. "The nutrition
gap is growing," he says. "My fear in public health is that it will
continue to grow."

Tell me about it. I start in the fresh produce section whenever I go to
a grocer and use the rest of the store to fill in the gaps. When produce prices
are too high, I buy more frozen fruit and veggies from the freezer section. Needless
to stay, our freezer is stuffed.

What’s particularly difficult to gauge: ingredient substitutions and
quality reductions. When food companies are stressed, for example, they often
substitute corn syrup for sugar. But what do food manufacturers use when corn
gets too expensive? No idea.

Because I regularly check ingredient labels – my wife is allergic
to corn syrup and I’m allergic to milk – I have a sense of when
substitutions occur. But as far as I know, there is no good way to track
product changes, which usually happen without fanfare unless someone gets sick
or complains.

Another kind of substitution: country of origin. For example, salmon and
grapes often comes from Chile.
Melons coming from Honduras
were
recalled in March
for salmonella contamination. But often fish, meat and
produce are labeled. The same cannot be said for packaged foods, which may have
ingredients from multiple countries.

Perhaps the best indication that food companies are cutting back on
quality can be measured in recalls. Whole Foods had to recall some beef after
one of its providers switched to a less expensive packing house known for less-than-stellar
quality, reports The New York Times.

And don’t forget more than 1,440 people were hospitalized
after consuming jalapeño and Serrano peppers contaminated by salmonella, reports U.S. News and World Report. The Food and Drug Administration wasted 89 days
blaming tomatoes for the outbreak. Expect more recalls if food makers and
growers continue to cut costs.

What can apprehensive parents do?

Now that we’re living in the
suburbs instead of on the 15th floor in Chicago, we’ve planted a garden.
Perhaps nothing will grow in the hard, gooey-red Scottsdale soil, but certainly some crops –
zucchini always grows – will take the edge off of high food prices. An
added bonus: my kids get to learn something about botany and dirt.

Farmer’s markets are another good option, though some charge far
beyond big box stores. Savings success will vary by family and location.
Chicago’s and LA’s farmer’s markets were exorbitant to begin
with.

Changing what you buy can also make a big difference: avoid the
high-end specialty products around the rim of stores like Whole Foods and
processed foods in the middle of all grocers. Potatoes are still relatively
inexpensive. Store-brand products and frozen produce often tend to be less
expensive.

Another option is those 99 cent stores. To be honest, I refuse to buy
expired food or cans from questionable origin, but if you’re okay with
the idea, at least you cannot complain too much about inflation. The first ever
price increase
at the stores was about a penny, reports the Los Angeles Times.



That’s a 99.99 cent store, in case you didn’t follow the link.

Thanks Brett! So Thinga-readers… How have food prices impacted your family, and have you changed your eating or buying habits?

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Comments

11 Responses to “Coping With High Food Prices”

  1. BusyMom says:

    Interesting. Some of this I knew, others I did not. The thing with warehouse clubs, is that many items (on a per ounce/per unit basis) are still cheaper when on sale at your local store. I did a full price comparison one time and things like IQF chicken and cereal were amongst the culprits. Milk is usually a deal (except in Ohio, where grocery stores discount milk).

    I am new to blogging and my second ever blog, back in July was about the downsizing of prouducts. http://abusymomoftwo.blogspot.com/2008/07/downsizing-of-everything.html

    I had just read a newspaper article on the subject and was surpised at the tactics of indenting the bottoms or increasing tapers sor decreasing depth, so that on shelf it didn’t appear smaller. Unless you see the two side by side, the change can easily go unnoticed. To me, the one I never would have noticed in a consumer package was toilet paper – that I noticed because of the fixed width roll holders in the bathroom at work that suddenly had adaptors on them.

    September 12th, 2008 at 3:19 am

  2. Sara says:

    Make a list and stick to it! That has always helped me to stay on my grocery budget. As food goes, I have to make different choices for the meals I prepare to try and stretch things farther as costs increase (the normal block of cheese that I buy at the store has gone up in price about $2 since my son was born, 2.5 years ago). I really do want to try a garden next summer…I think it would be a fun family project, although I have a very non-green thumb.

    September 12th, 2008 at 6:05 am

  3. Kathleen says:

    I think it is important to really take the time to figure out the cost per sheet or ounce or pound of whatever item you are buying. I say this because when my husband and I were first married we thought buying at the bulk clubs was ALWAYS cheaper and didn’t think much because we had 2 salaries. Now with children added to the picture and 1 salary, I have learned to be much more thrifty. This includes breaking out the math and taking an evening each week to figure out the best grocery strategy for the week. Amazingly, once you stack coupons with sales ( and price matching) you can find most things cheaper at your local grocery stores than at bulk clubs.
    Also, don’t discount Walgreens (use their register rewards and easy saver book) and CVS (use their extra care buck system) for GREAT deals. We have stocked out pantry with health and beauty items after getting most for less than $1 or FREE.

    September 12th, 2008 at 6:13 am

  4. Nancy says:

    Shop the circular and use coupons. We take the time to go through the coupons in the weekend papers and save a lot that way, especially on double or triple coupon days, which seems to be almost all the time at my grocery stores. Combining coupons with store sales really saves us a ton of money.

    Also we are members of BJ’s, who have their own coupons but also accept manufacturer coupons, where I know Costco doesn’t (not sure about Sam’s). We have compared prices on products and most of the time BJ’s is cheaper, even with coupons, but there are times the grocery store can be cheaper.

    September 12th, 2008 at 10:22 am

  5. brandy says:

    Convenience items, even cereal, are making their way off my list in favor of making things from scratch. I belong to an organic co-op and purchase most of my produce through that; I’m able to get several organic items at the same price I’d pay for a conventional at the store. I’m also cooking strictly vegetarian at home. Beans and rice are cheap as staples, and the money I save by not purchasing meat gets funneled into other parts of my grocery list. It is not easy, but I try to keep my weekly grocery bill for a family of 5 (kids aged 2, 4, & 5) around $125.

    September 12th, 2008 at 5:58 pm

  6. Mark says:

    As I posted over on Brett’s blog, go to the consumer advocacy blot Consumerist.com and do a search for the term “grocery shrink ray.” They’ve been documenting the phenomenon of companies making subtle changes to their packaging to decrease the amount of product you get for a couple of years now. The main motivation for this is to keep brand loyalty — once people get attached to a particular brand, it takes something fairly extreme to get them to switch. If they don’t notice the rising prices, then they won’t switch. Their advice is to be ruthlessly brand ignorant — be willing to switch products, try generics or in house store brands in order to save money whenever possible.

    September 13th, 2008 at 12:01 am

  7. brettdl says:

    I love all the great ideas. I’m especially impressed Brandy can keep her weekly bill down to $125 a week for a family of five. We run much higher, I’m afraid.

    September 13th, 2008 at 6:12 am

  8. MoJo says:

    We are growing a bigger than normal garden this year. I planned what we grew according to what my kids eat a lot of. My kids love green beans. So this year, I planted lots and am in the middle of canning them. I also have made more applesauce and bought little containers for my daughter to take it to school. And dried fruit was something I never bought at the store, but it is snack now that is basically free from our yard. I have also started shopping around instead of doing a large shopping at one store. I am probably not saving too much money because I am driving more. Some organic items are taking a back seat, but I am instead trying to focus on healthy food and know that I survived just fine without organic cheese, etc. Buying in bulk and meal planning in advance has also saved me money. I notice that I go to the store less (which keeps me from buying impulse items) and I can sometimes stretch a meal into a lunch or another dinner. We are definitely feeling the crunch of groceries, so we are trying to put much more thought into it.

    September 13th, 2008 at 1:01 pm

  9. LiteralDan says:

    I have been noticing and reading about this, and it makes me mad– they should just adjust the price. They’re getting so greedy as it is that you can’t help but notice a lot of the changed items, so they may as well stop clinging to the illusion.

    September 13th, 2008 at 10:04 pm

  10. Heather says:

    I have read a few blogs recently where moms have discussed using powdered milk instead of the real stuff when the milk prices are high so they can stretch their grocery budgets. What kind of economy is this where we are being so stretched to purchase gas and other inflated items that we let nutrition suffer? What kind of government lets this happen? Gas for the car or milk for the kids? This shouldn’t be a dilemma. Everyone is feeling to economic stress…from companies that make peanut butter to moms buying milk. I bet the moms haven’t had a raise this year…I wonder about the peanut butter making CEOs.

    September 14th, 2008 at 7:23 pm

  11. Megan says:

    Ha, they should change the name to “Skimpy” peanut butter.

    We’ve noticed the same thing with ice cream – the half gallon is a thing of the past. I’ve also noticed that some stores make it hard to do per-unit price comparisons – some brands are listed in cents per ounce, others in cents per pound. I may have a PhD, but I can’t do that calculation in my head. Maybe we should switch to drinking Ensure 3 times a day.

    September 22nd, 2008 at 5:11 pm

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