Despite increasing coronavirus vaccine sales in the U.S., certain groceries are getting pricier in the United States.
While the nation slowly attempts to reopen toward pre-pandemic levels, retail experts say food and labor shortages are driving up prices for consumers.
According to Nate Rosier, senior vice president of supply chain consulting firm enVista, there are several reasons why prices are going up in the current market.
The labor challenges in several fields currently contribute to increased inventory costs and reduced supply fill rates.Further, labor and transportation challenges contribute to the volatility of transportation assets, making it difficult to reach the reliability of inbound shipments that existed pre-COVID, Rosier tells FOX Business.The culmination of these factors is in grocery stores across the country and makes for higher costs and more unstable inventory.
The last consumer price index published by the Bureau of Labor Statistics says food staples like fruits and vegetables increased in the month of March by 1% while meat, poultry, fish and eggs went up by 0.7%.
However, some nonalcoholic food items on the opposite end were dairy canned beverages cereal and baked goods that die on the index.
When examining consumer price index in a 12-month period, the BLS noted that the food at home index increased by 3.3%.
All six major grocery group indexes increased over the period with increases ranging from 1.6 percent to 5.4 percent by BLS in its March report, which was distributed last month.
Other factors likely to play a role in reducing grocery prices are rising gas prices and an declining retail workforce, according to Tim Bain, president and chief investment officer at Spark Asset Management.
Demand for oil and gas is rising faster than supply in the economy as inflation causes higher costs to transport goods, says Bain FOX Business.Second, there are still supply chain issues as a result of the pandemic and many workers are choosing to stay home and collect unemployment and stimulus money instead of going back to work.The most recent Job number highlights this.
In the month of April, the BLS reported that nonfarm-related payroll employment rose by 266,000 jobs instead of the predicted one million jobs economists wrote about in forecasts.This labour shortage includes supermarket workers, truck drivers and other employees who are essential to the grocery industry.
Other factors that are making America's food supply more expensive include severe winter storms that have reduced or eliminated supply of certain goods and a growing demand from pantry-loading consumers who continue to cook more at home, according to ScanSource's Director of Channel Marketing at Nell Alverson.
The shortage of truck drivers has caused an increase in the cost of transportation and grocery prices most likely continue to go up this summer until the supply chain levels out, says Alverson on FOX Business.As with almost any supply chain, the costs eventually trickle down to consumers.
If it comes to saving money at the grocery store, shopping expert and blogger Trae Bodge advises money-conscious consumers look towards loyalty programs, Discount Apps and savings tools and credit card rewards programs foused on food.
With prices rising in certain categories, it's a good opportunity to exercise new money-saving habits now and continue to use after prices lower, Bodge wrote to FOX Business.