Does anyone know why food prices are falling?

[CoffeeCat]

I know it's a little bit nutty, but I belong to a coupon/refunding club--and we meet and share
great deals that we get at the grocery store.

So, I guess you could say we're price hawks. We know when prices are going up and down, and
we pay attention to the weekly grocery ads.

We've noticed that food prices are falling. I'm wondering why this is.

When food prices rose, the blame was laid on rising fuel and transportation costs. Could
the lower price of gas be the reason?

Has there been some change in the supply and demand of commodities? Could
this be deflation?

I've noticed that food prices generally have gone down. In addition, grocery store sales
are amazing around here. Grocery stores always try to get you in the door with loss leaders that
are good deals on sought-after products. However, the loss leaders too are very cheap. Much
more cheap than usual.

It's possible that less consumer spending has forced stores to offer reduced prices, as they
compete for those fewer dollars being spent.

We've also seen a remarkable increase in coupons and the value of coupons. $1 off 1 Kellogg's
cereal was always considered great. Lately, they've been putting out $1.50 off 1, which is totally
unheard of. There are also more product rebates as well. There's a $10 rebate for Kellogg's products
right now. When combined with their coupons--you get the stuff for free.

Does anyone have any insight into why this is happening right now? Thanks for any insight.

[MajorChode]

1. Fuel prices, competition, supply and demand

I've been noticing that grocery stores have been offering better deals in their ads to get people in the door, but lots of things still seem to be quite pricey.

[HopeHoops]

2. Um, not that I've noticed.

Although they haven't increased by much since Bush got out of office - that's when they went up.

[willing dwarf]

3. I don't know for sure

But I think the price increase was largely due to corn being pumped into ethanol and so the price of corn based food and corn sweeteners was going up and up. I think the diminished interest in corn for ethanol and decrease in fuel prices generally has eased that tension.

But remember, if you are buying food with coupons, you may be saving money on the food you eat, but the cost to your health and well being might be inestimable. Processed foods are the ones that they give coupons for usually and so they are full of additives, high fructose corn syrup and salt. Not so good for a person. Better to eat more expensive foods that are closer to the earth if you ultimately want to save. (end of sermon).

[CTyankee]

10. So true. Today my supermarket had Raisin Bran and Cheerios on sale.

I had only a very few choices in the organic cereal aisle for cereal without evaporated cane syrup (which is sugar) and sugar.

I'm trying to get back to cooking meals without use of any prcessed food products, because of their fat and sodium content. I have a cookbook for low sodium/low fat meals but had found that they were often complicated and used a myriad of pots, bowls and measuring spoons/cups. I'm lazy about kitchen clean up now so I have to rearrange my thinking. I did enjoy those recipes; they often used very good ingredients that made the dishes delicious.

[louis-t]

11. I think you're off base about corn/ethanol.

Price of corn went up because speculators drove it up. There is not "diminished interest in ethanol". More and more stations around here are offering E85. It is still a 10% savings over regular unleaded. Almost every Chevy I see says "flex-fuel" on it. Food staples are going up in price. What is going down is the junk food, processed stuff, like you said. Everyone cutting back on the luxury items. People eat out less, restaurants are offering deals. Fast food prices have risen dramatically, but they all offer $1 menu items. I paid $6.25 yesterday for a BK breakfast that 2 years ago cost $4.25. They super-sized their drinks and raised the price. A "small" is now $1.69. I should have bought the ham omelette sandwich for $1.

[CoffeeCat]

26. I totally agree about the foods/coupons...

I've been a couponing "pro" for about seven years. I'm one of those people who can get a cart full
of groceries for under $25. I do agree that many coupons are issued for processed food, and for things
that are unhealthy.

I don't buy a lot of processed foods and I'm a label reader.

I am able to get coupons for lots of organic foods and foods that are healthy. Furthermore, I get
produce for FREE or cheap nearly every week, by using Target's coupons.

Since you're very health conscious, you might be interested to know that right now Target has a "Save 50 cents
off 1 lb of bananas" coupon on their Web site. If you go to afullcup.com you can get all of the Target coupons, and
print off multiple copies. I got free bananas this week, by buying one pound at a time. Also, there is a $1/1 General
Mills cereal coupon at the fullcup site. You can use this coupon to purchase the small cups of General Mills Cheerios.
Those are healthy! Plus, they're free with those coupons.

Last month, I got free carrots, broccoli and cauliflower doing this.

The Target coupons say, "Limit one coupon per transaction", but I have been never had any cashier say anything about it. This
is new verbiage on their coupons, so I'm not sure why it's there. I use about 5 of the same coupon, with no problem.

Oh, one more thing---there's also a $1/1 Archer Farms Artisan Bread coupon. You can use that coupon to purchase the small
whole grain loaves, which are $1. FREE healthy, whole-grain bread!

I also get Kashi products for super cheap. Their frozen meals are more than $3 and I'm getting them for 88 cents right now--and also
their whole-grain $2.50 waffles, I'm getting for 25 cents. if you were a couponer, you could do this too!

I need to start posting stuff like this regularly...I'm sure many DUers could benefit.

:-)

[Cleita]

4. I noticed my local Albertsons has a big banner announcing lower prices.

I guess people are going hungry from lack of jobs and money so they are buying less.

[rucky]

5. I think it's more spending @ grocery stores.

And higher volume leads to lower costs. Grocery stores operate with a pretty tight margin (4%, I think), but if they're moving product more quickly they get lower prices from distributors.

[louis-t]

12. Hmmm, how does 'supply and demand' work, again?

I thought demand created higher prices.

[rucky]

19. And production volume is up, too - the shelves are full at the grocery store.

And mass market works on scale:

If you've ever seen a distributor's price sheet, there are breaks based on the quantity you buy.

If a grocery store has set margins, and gets a lower (or higher) cost, that increase/decrease is passed on to the consumer.

My guess is the producers stepped up production in anticipation of increased demand - now they have to move the stuff.

[louis-t]

31. Makes sense.

[charlie]

6. Commodity speculators had a lot to do with the price runups

They overheated the markets and reaped a collapse in a number of commodities, so prices are easing. However, signs are they're back at it again, compelling governments, including our own, to take a good look at regulating their behavior.

[rox63]

7. Grocery prices aren't going down where I live. n/t

[timeforpeace]

14. I've always done the grocery shoppin, pay close attention, and prices are not going down here.

[Individualist]

23. Not going down in my area either.

[aikoaiko]

8. I assumed it was due to fuel costs going down, but I also wondered if

a lot of brands got hurt with people switching to no-frills when the costs skyrocketed last summer.


I know I switched on a few things.

[Missy Vixen]

27. I just read yesterday at msnbc.com

that store brands are showing a significant increase in popularity.

We're also shopping more at Costco; we've discovered their produce department. I'd rather pay $5.50 a dozen for Pink Lady apples from a blue company than $1 apiece for the same thing in the grocery store. Costco has some amazing bargains on many other items.

[kestrel91316]

9. Demand destruction. Consumers have much less disposable income,

so grocery stores have to compete for a piece of a MUCH smaller pie.

[Subdivisions]

13. That has not been the case here in N. TX. Prices have been higher

on lots of items and where the price hasn't been higher the weight of the product has been less. You may be on the leading edge of a general trend though and, if that's the case, my guess would be that you might be seeing a symptom of deflation. If you need that explained, just google it. Suffice it to say that deflation is probably just as bad or worse than inflation. A firm understanding of why requires research.

[Pharlo]

15. I haven't noticed food prices drop around here much.

In fact, I've noticed a couple of my staples (peanut butter, jelly, beans) have gone up in price since my last purchase. (Note for comparison purposes - I don't buy cereal, milk, eggs, or meat.)

O/T, but I have The Damn Mutts on Purina One and it was $18.04 for the longest time. About two weeks ago I noticed they had $ 1.50 off coupons in the bags. Yesterday, I got a bag, it's up to $ 20.04 for the same bag (~ 35 pound bags).

[quiller4]

22. Tyson is an Iams dog and his small bag has dropped $.45 in

the last month.

[seabeyond]

40. see if quantity hasnt reduced even more. nt

[SoCalDem]

16. Last week I was at Target.. in their grocery section

passed ONE customer with a basket..ONE.. this was mid day....not right after they opened..

I think that lady and I were the ONLY ones in that "Super" Target.

Two check-stands going..NO LINE..

My friend had a similar experience there a few days later..

Maybe lower prices will lure customers in:shrug:

[RebelOne]

17. Actually, I have not seen any change in food prices.

They have been holding steady where I live in North Georgia. At least, they haven't increased lately. I shop mainly at Kroger and they have some really good deals, such as the 10 for $10 sales. You don't have to buy 10 of the item, so just one is $1. But if it is something I use often, I stock up.

[pecwae]

18. I keep reading here at DU that

food prices are decreasing, but I've yet to see any kind of decrease in my area or the area where my extended family lives.

[lildreamer316]

20. Strange..prices are increasing here.

You are lucky...

[quiller4]

21. Fuel prices , in the West bumper crops of most fruit , transport on

agricultural feed prices dropped and that may have nudged down meat prices. I, too, have seen a big drop in all my non-dairy food purchases.

[ParkieDem]

24. Fuel prices are one reason.

It's also getting close to harvest season for several crops, meaning there is typically somewhat of a glut of quite a bit of produce, etc.

Plus, kids are starting school, so many parents don't have to worry much about daytime meals.

I am seeing a slight dropoff here in the North Texas area, but it's not significant.

[Arkansas Granny]

25. I haven't noticed any falling food prices on the items I buy.

Granted, I don't do much comparison shopping and just buy my usual items without checking the price, so it would probably take quite a reduction before I noticed any difference.

[Hannah Bell]

28. because we're in a world-wide deflationary depression?

[zbdent]

29. have you also noticed that the sizes of the products have reduced?

I kid you not ... shades of the regulation of 2" X 4" boards, I found a packet of 2" X 2" post-it notes ... actual size, 1 & 7/8" X 1 & 7/8" ...

[CoffeeCat]

30. That's hilarious...

...and if you want further food comedy--take a look at the boxes of Chocolate Frosted Mini Wheats. There's about
one bowl in each box!

Yes, the sizes of products--from toilet paper, to peanut butter, to cereal and household cleaners--is shrinking.

I stockpile some foods and I probably have 30 jars of peanut butter. They're arranged by earliest expiration date. I happened
to notice the other day that these jars of Jif pb shrunk 2 oz. once...then 2 oz again. PB jars are 4 oz less than they were about
18 months ago. It's nutty.

Pun intended...

[OmmmSweetOmmm]

36. Cans of Folgers coffee from 1 lb. down to 13 oz down now to 11.5 oz.

[seabeyond]

38. peanut butter they made an indentation at bottom to take out quantity

oh so tricky

yes. everything is reducing and charging as much or more

[seabeyond]

35. you have noticed. me too. ALL things. 10 chimichangas now 8. taquito size reduced a third

i am seeing it everywhere. bought same brand buns and so little, reduced at least a third

[JVS]

32. Are they?

[seabeyond]

33. havent you noticed the reduced size and quantity in all things. IF dropped prices

per gas going down (which i have not noticed reduced prices), they have also reduced all sizes in all things. i mean all things. spag sauce, bun sizes....

i am noticing it everywhere in the product i buy.

each little amount they take out in quantity they make money

[OmmmSweetOmmm]

34. Lots of loss leaders to bring you in. Other items here not on sale are still high.

[pitohui]

37. um, because they're NOT? seriously, prices soared since katrina and never went back down

in the new orleans area prices soared sky high after the storm and have never gone back down

i've tried to cut back to one meal a day

"more" rebates is a joke, the rebates we used to get have been cxl'd -- walgreens for example has now completely cxl'd its "freebate" program -- it used to be that cosmetics/hair color were essentially free after the rebates, if you were willing to use the brand offered each month in the rebate

cereal is not a food that anyone w. metabolic syndrome/diabetes should be eating, which includes my hubby, so i don't follow cereal prices, i guess they're worth free if the alternative is not eating at all but i've found it wise to avoid having such things in the house since carb/sugar addiction is more than a buzz word for some of us

the price of milk has finally come down a little, but cheese is more costly than ever and i'm not sure why

most couponers that i've read about with a full discussion of what they eat/buy -- we can't live like that, their diets are death on anybody w. metabolic syndrome/diabetes -- way too many processed foods get bought and eaten if you do grocery coupons, no offense but that's just reality around here -- "real" food like milk, meat, cheese, fresh veggies or even un-fucked-up frozen veggies is not couponable - target, costco etc. are not options here, walmart has a grocery store and its prices are usually cheaper than the other stores even after you apply coupons but the selection is not real strong

[upi402]

39. the film, FOOD INC. maybe

has them running scared, or at least behaving, lest they get corrected by a less than neocon government.

[Spider Jerusalem]

41. Deflation

the cost of living index increase is negative. This means lower prices for food (among other things).

[WI_DEM]

42. they are?

[Pangolin2]

43. I must be buying all the wrong stuff. Everything in my basket just keeps going up.

Coincidentally, I had just gotten back from the market and was thinking about how it seemed I had spent
about 10% more than last week for pretty much the same stuff when I saw your post. :shrug:

[Greyhound]

44. Don't know where you live, but they're still going up rapidly here. n/t

[Bluenorthwest]

45. Around here they are high and not dropping

in addition, the lousy level of coupons was a subject of conversation on Sunday. Not any good ones to speak of at all. Nothing like what the OP describes, but then the OP does not say where they are writing about, and just like the others who are posting 'gee everything is so cheap now' posts, there is not one quoted price. Not one '5 a pound is now 3 a pound' sort of comparison. Just blanket statements.
The OP does manage to promote a certain brand of cereals that many, many Democrats are currently boycotting for many reasons. Kellogg's cereals are loaded with High Fructose Corn Syrup, and they no longer taste as good as they did, as well as being flat out unhealthy.
I invite the OP to make share some actual prices, and the percentage they have 'dropped' as well as sharing the location of what to me sounds like a paradise of pricing. Here, prices are high, coupons are terrible.