Sticker shock on aisle 1
This story looks beyond sticker shock at gas pumps and looks at the sticker shock in the grocery store. Of course, the two are related, as higher gas prices also increase the delivered costs of fruits and vegetables. The rising price of corn, tied to escalating ethanol demand, is also contributing to higher cereal, milk and meat prices. The story also notes the impact of the freeze on California citrus prices.
TK: Rising fuel and food costs will put pressure on household budgets and could suppress fruit and vegetable demand. Produce managers will have to keep a watchful eye on that reality this summer and come up with some creative ways to overcome that barrier to increased sales.
posted by Tom Karst @ 8:36 PM
1 Comments:
Milking the buyer
Moo juice could beat gas to $4 a gallon
BY JENS DANA and ETHAN ROUEN
DAILY NEWS WRITERS
Posted Saturday, May 26th 2007, 4:00 AM
Gas prices may be skyrocketing, but milk could break the $4-a-gallon mark first this summer.
The federally set price of milk has moved up 63 cents since December and will leap another 33 cents, to $3.87 a gallon, June 1.
According to New York State Dairy Foods, a dairy industry trade association, the federal government will likely allow farmers to boost prices again in July, putting milk on track to break the all-time $4.43-a-gallon record set in 2004.
By comparison, the average price of gas in the New York area this week is $3.31.
"I've never seen increases like this, and I've never seen projections like this for what the future prices will be," said Steven Schwartz, executive director of Dairy Foods.
Schwartz blames the rising costs of feed and fuel as well as the weak U.S. dollar for the bullish prices - which could keep rising well into 2008.
Production of ethanol, an alcohol used as a fuel and a fuel additive, has created a huge demand for the corn used to feed cows. That jacks up feed prices for farmers and reduces the amount of milk they produce.
In addition, foreign companies are buying U.S. surpluses of powdered milk because of the strength of their currencies against the dollar.
Ice cream and cheese makers usually depend on powdered milk to make their foods during the summer rush, but the short supply has sent them to liquid.
Milk prices traditionally rise between June and September, but this year the price increases are expected to continue into 2008, Schwartz said.
That leaves New Yorkers little choice but to dig deeper into their pockets. "It's outrageous," said Renae Capers of Harlem as she shivered in the Cold Room of the Fairway Market on 12th Ave. and 132nd St., where a gallon of milk costs $3.39. "If I had kids, I'd be crying right now."
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