Grocers and restaurant operators will raise prices in 2010 as commodity costs rise, but most of the increases are likely to be given right back to consumers as “special” discounts and coupons.
Higher-cost staples like meat and milk are likely to drive U.S. food prices up 4 to 5 percent late this year, compared with 2009, Bill Lapp, economist and president of Advanced Economic Solutions, said at the Reuters Food and Agriculture Summit this week.
“We have beef, pork, and dairy prices all increasing substantially since December, in the area of roughly 10 percent,” he said. “Because food manufacturers and restaurants tend not to be philanthropic organizations, they are going to pass those costs on to their consumers.”
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