KIPLINGER FORECASTS

Home > Sector Outlooks, Economic Outlook

COMMENT

DEL.ICIO.US

DIGG

CHECK OUT:

EXECUTIVE POLL

Do you think the federal government will have to bail out Fannie Mae and Freddie Mac?

OUR PREMIUM CONTENT

The Kiplinger Tax Letter
The Kiplinger Agriculture Letter
The Kiplinger California Letter
Kiplinger's Biofuels Market Alert
Kiplinger's Retirement Report

SUBSCRIBER HELP

CURRENT LETTER

By Knight Kiplinger

The Kiplinger Washington Editors

August 15, 2008

McCain vs. Obama:
Another Close Race

Though the campaign has been under way for months, many -- maybe even most -- voters won't tune in until September. When they do, they'll find a tight race that could go either way. This week's Kiplinger Letter looks at what each candidate is trying to do to win your support.

ALSO IN THIS ISSUE: The Economy, Energy, Foreign Policy, Regulations, Human Resources, World Business, Fashion

PREVIOUS ISSUES

TRY THE LETTER: Subscribe | See Sample | Get Free 30 Day Trial

YOUR FEEDBACK

SUBSCRIBERLOG: Got a topic you'd like to discuss? Or a problem or question? Please join our exclusive forum for Letter subscribers only.

ASK US: A Kiplinger Letter editor will promptly answer subscriber questions.

OPEN FORUM: Share your insights and analysis with other visitors.

About a year ago I started a golf accessory online business . I would like to know how I can best market the site to get more visibility from customers as well as differentiating myself from other golf online store.

-- wyngategolf

Why Grocery Bills Are Higher

Consumers are shelling out a lot more for milk, eggs and other staples, but getting a break on oranges and ham.

By Ed Maixner, Editor, The Kiplinger Agriculture Letter

March 27, 2008

RELATED FORECASTS

HELPFUL LINKS

EDITOR'S PICKS

U.S. grocery prices will climb another 5% or so this year, measured Dec. to Dec., following a 5.6% increase in 2007, the first time they topped 5% since 1990. Typically, prices climb between 2% to 3% a year.

Blame more than just the soaring prices for corn, wheat, soybeans and other field crops that serve as ingredients for both processed foods and livestock feed.

Fuel and shipping costs are tacked onto food bills, too, and transportation costs are up 9% overall in the past year.

Moreover, imported food is getting costlier, in large part because of the weak U.S. dollar. The U.S. imported foods index shows a 13% jump in prices over the past year, boosting prices for coffee, fish, wine, peppers, bananas and other commonly imported products. Imports accounted for about 15% of total U.S. food, by volume, in 2005, and the percentage has inched up since, says Andy Jerardo, an economist with the U.S. Department of Agriculture.

Also contributing to higher grocery prices: Rising debit and credit card fees that stores must pay and then pass on to consumers. Bill Greer, a spokesman for the Food Marketing Institute, says the fees were only 1% of the grocery bill back in the early 1990s, but now average about 2% nationwide, exceeding supermarkets' gross profit margins, estimated at 1.9%.

However, even a 5% overall increase for groceries may seem small, when considering that the price of milk is up 30%; flour, over 25%; eggs, 24%; and margarine, 20%. On the flip side, prices of other foods, including oranges, ham and lettuce are down. Oranges, for example, cost about 35% less than a year ago. And other items such as sugar and sirloin are priced at near year-ago levels.

For weekly updates on topics to improve your business decisionmaking, click here.

READER COMMENTS