Food prices have reached their highest level in a decade as the coronavirus continues to wreak havoc on businesses left reeling from a labor shortage and issues within the supply chain.
The Food and Agriculture Organization of the United Nations released data showing that the FAO Food Price Index, defined as "a measure of the monthly change in international prices of a basket of food commodities," had risen by 1.5 points from August to September, with an average of 130.0 points in September. In addition, compared to the same time last year, the FFPI had risen by 32.1 points, or 32.8%, the highest it's been since 2011's FFPI of 131.9.
Among the commodities measured by the FFPI, vegetable oil saw the highest increase at 60% compared to the following year and up by 1.2% from the previous month. Cereal prices saw the second-largest jump in food prices, rising 27.3% from the same month last year, and the Bureau of Labor Statistics reported seeing a 3% increase in its Consumer Price Index, which measures grocery prices, according to data from August. Over the course of 12 months, the price for all household and grocery products increased by 5.3%.
In early September, the Biden administration announced that it was implementing new measures to combat the rise in prices on meat products such as beef, pork, and poultry, which accounted for more than 50% of the recorded price increases.
Supply chain experts are already issuing warnings to consumers to prepare ahead of the holiday shopping season, as large and small businesses alike continue to experience issues relating to labor shortages and kinks in the supply chain resulting in rising shipping costs and cargo being stuck in seaports.
U.S. Transportation Secretary Pete Buttigieg explained that some seaports are experiencing "record traffic," and while they are trying to address supply chain issues, they are unlikely to do so by the holiday season.
🔴 @FAO Food Price Index rises further in Sept led by tightening supply conditions and robust demand for staples such as wheat and palm oil.
All-time record cereal output in 2021 still below consumption needs.
👉 https://t.co/AusyQQBPVb #FoodPrices pic.twitter.com/iIRjH45bHW
— FAO Newsroom (@FAOnews) October 7, 2021
Larger companies such as Kraft-Heinz, General Mills, which produces cereals such as Cheerios, Cinnamon Toast Crunch, and Lucky Charms, and Campbell's Soup have announced that they would be raising the prices on their products to counteract inflation.
Miguel Patricio, the CEO of Kraft-Heinz, said consumers will have to learn to get used to rising food prices due to inflation being "across the board," but he maintained that "it's up to us, and to the industry, and to the other companies to try to minimize these price increases."
The Washington Examiner reached out to Campbell's Soup, Kraft-Heinz, and General Mills but did not receive responses back.
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Original Author: Elizabeth Faddis