Source:  Rita Jane Gabbett, MEATINGPLACE, 6/10/11

Retail food prices at the supermarket increased by 4 percent in the second quarter from first quarter prices and rose 8 percent from a year ago, according to the latest American Farm Bureau Federation Marketbasket Survey.

The informal survey shows the total cost of 16 food items that can be used to prepare one or more meals was $51.17, up $2.10 from the first quarter, with beef, deli ham and bacon leading the way.

Sirloin tip roast, Russet potatoes, sliced deli ham and bacon increased the most in dollar value compared to the first quarter of 2011. Together, these four items accounted for most of the quarter-to-quarter increase: sirloin tip roast, up 52 cents to $4.48 per pound; Russet potatoes, up 43 cents to $3.07 for a 5-pound bag; sliced deli ham, up 35 cents to $5.26 per pound; and bacon, up 32 cents to $4.18 per pound. Ground chuck prices rose 19 cents to $3.29 per pound.

“Strong consumer demand for meats and dairy products continues to influence retail prices,” said AFBF Economist John Anderson. “Consumer demand for meats and dairy products began to recover in 2009, continued through 2010 and is still a factor as we move into the middle of 2011.” He noted escalating energy costs are affecting every aspect of the food chain, including production, transportation, storage, processing and marketing.

Most items showing quarter-to-quarter increases also increased year-on-year. Compared to one year ago, Russet potatoes increased 22 percent; bacon rose 18 percent; ground chuck was up 14 percent; and sirloin tip roast was 9 percent higher.

Two items decreased in average retail price between the quarters: boneless chicken breasts, down 23 cents to $3.09 per pound; and shredded cheese, down 7 cents to $4.56 per pound.

“Further retail price increases are likely to be the new normal as we move through 2011, especially for meats. It takes time for farmers to increase the size of their herds to in order to meet higher demand,” Anderson said.

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