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Thursday, Oct. 23, 2014

Consumers feeling hit of economy in grocery stores

Thursday, January 17, 2008

(Photo)
Kim Sears, assistant manager at Save-A-Lot, stocks the store's milk shelves
(Photo by Tim Jaynes, Staff)
Increases in the cost of food and fuel are the highest since 1990

SIKESTON -- With the struggling economy, the hits keep coming for cash-

strapped consumers, and now it's occurring in the grocery store aisles.

On Wednesday, the Labor Department said inflation is up by the largest amount in 17 years. In 2007, consumer prices rose by 4.1 percent, a sharp increase from the 2.5 increase in 2006. Increases in both food and fuel are the largest since 1990.

"I've never seen increases like this before," said Eddie Moore, store manager at Save-A-Lot, who has worked in other managerial positions in stores for more than 20 years. "We've had more increases in the past two months than I've seen in the past five and a half years I've been here"

The prices of more items, on average, rise each week, and in higher amounts. "In some cases, it's about 50 cents an item, where it's usually been just a few pennies," said Moore.

Increases in food prices are across the board but seen mostly it items such as eggs, milk, vegetable oil and cheese.

Diane Olson, director of promotion and education programs for the Missouri Farm Bureau, said that one of the biggest factors in the higher prices is the cost of fuel.

"The energy cost is impacting everything we're dealing with in the food supply," she said. Not only is fuel used for transportation, but also in a lot of packaging. Plus, consumers have to use fuel (and oftentimes, it's costing more and more these days) to get to the grocery store.

She suggested people aren't as accustomed to fluctuating grocery costs as they are fuel. "We enjoy such an affordable food supply," said Olson. "Any time people see even a slight increase in food prices, they panic."

Moore agreed that the fuel costs have impacted the prices. "I'm seeing surcharges for gas that I didn't use to see from a lot of the smaller vendors," he said.

Customers have noticed the higher prices, too. "They complain about it, but I think they understand the price of gas is primarily the reason that it's like that," said Moore.

For instance, last week he overheard a couple discussing egg prices. "The darn gas is the reason for this," he recalled them saying. "I think that's a common feeling among our customers."

Customers aren't the only ones feeling the pinch though -- retailers are, too, in order to stay competitive. "We do comparisons every week," said Moore. "We're going to stay competitive with everybody else around here, even if it means we have to not make something on an item, that's what we intend to do."

Organizations and groups that sponsor meals as fundraisers are also making some sacrifices.

Each Thursday, the Vanduser First Church of God sponsors an all-you-can eat buffet-style meal. The profits from that pay for the family life center and will fund a new church.

"We're trying to keep everything the same, even though the prices have gone up," said Anita Graviett, a church member. "We feel it would hurt us (if we charge more for the meal)."

Although she didn't have specific numbers of the price increases for food, the costs do increase each month, on different items.

The main increases, however, have been for sugar, flour, eggs, shortening, canned milk and paper products, she said.

Olson stressed that farmers aren't making any more money, although some commodity prices are up, because they, too, are hit by fuel costs.

"His cost of business is going up... gasoline and fuel prices affect everything they do," she said.

Comparatively, farmers actually receive less per dollar spent on food than in the past. Right now, the farmer makes, on average, 19 cents of every dollar, while in 1980, that amount was 31 cents.

The Associated Press contributed to this report.