Thanksgiving to bust wallets as turkey and flour prices surge
Bloomberg November 10, 2022
Any way you slice it, this Thanksgiving is going to cost more.
Price increases for flour and cookies hit a record high year-over-year for October, U.S. government data showed Thursday. Eggs jumped the most since 2007. Turkey and other non-chicken poultry were up 17%.
It's all part of historic food inflation that's hammering consumers also grappling with sky-high prices for everything from fuel to housing. The war in Ukraine is upending global supply chains, while the ongoing bird flu outbreak is decimating egg-laying hens and turkeys. Scarcity and surging prices may trigger a shift in buying habits ahead of the holidays, according to Russell Barton, a director at commodity researcher Urner Barry.
For shoppers, "it might be a first come, first served-type situation," with people substituting other proteins such as ham, beef short ribs and roasts, Barton said. Others are switching to lighter fare such as soup, salad and pizza. Historically, many traditional menu items see a lift before the holiday, according to retail analytics firm IRI Worldwide, which released a Thanksgiving Tracker of sales and sentiment.
As avian flu wreaks havoc on bird supply in parts of the U.S., Iowa Sen. Charles Grassley and Minnesota Sen. Amy Klobuchar have pushed for more funding to mitigate the outbreak. Agriculture Secretary Tom Vilsack said last week that even though it might be challenging to find a 20-pound turkey in certain locations because there hasn't been time for them to grow, he's confident there will be turkeys available to carve. "It may be smaller, but it will be there," he said.
Butterball, the largest U.S. producer of turkey products, said it had to raise prices to customers after its cost of production nearly doubled. "We've had the impact of inflation and skyrocketing grain costs," Chief Executive Officer Jay Jandrain said in an interview this month. While the company doesn't expect turkey shortages, "there will not be a surplus left over," he said.
Still, optimism about a cool-off in prices is growing. US inflation slowed in October by more than forecast, offering hope that the fastest cost increases in decades are ebbing.