(NewsNation) — American consumers are being hit by the high costs of food on their trips to the supermarket.
Beef has gone up over 14% and eggs have gone up nearly 23%.
Economist Ernst Coupet Jr., Ph.D., and professional grocery shopper Matthew Telles discuss the rising cost of food and tips for saving money at the grocery store as part of “Morning in America’s” Economic Brain Room.
Q: There are some signs from economists that inflationary prices have reached their peak, what are those signs?
Coupet: One of the signs that we look for, it’s like a math function, really, You look at trends. So we have what’s called the core inflation. Core inflation is inflation that’s measured, taking away food and energy.
So then you add in the food. The food is sort of, you know, up and down. So when we look at inflation, in terms of a long-term inflation, the core inflation gives us a good sign. That seems to be stabilizing. So that implies a maximum is about to be reached or has been reached.
In addition to that, we know that the Federal Reserve Bank has been increasing interest rates, which is going to cool off the economy. So not as much money is flowing in the economy anymore. Interest rates on credit cards are beginning to rise. Mortgage rates, the housing market is actually starting to reach its max and starting to taper off. So with that said, it tells us that the money subtraction, contraction from the economy that the Fed is trying to obtain is working.
Q: Russia and Ukraine accounted for 24% of global wheat exports, 57% of sunflower seed oil and 14% of corn exports. What could be the ripple effects, especially here in America?
Coupet: Those products that you just mentioned are what we call input factors to a lot of production functions of various parts of the economy. So as the price of input rises, the output price will also, the cost rises. Meaning that either they’re going to cut back on the supply, or they have to charge more.
Q: According to a recent NewsNation/Decision Desk HQ poll, 70% of those responding cut back on purchases over the past month, with over half trying to save on groceries. What are ways that people can really practically save on grocery shopping?
Telles: Really, right now, it’s the things that you should have already always been doing, not just this year, not just during the pandemic, like your whole life, buying food, just saving money is good. And not just when stuff’s expensive. So you really want to start focusing on your waste. People waste about 40% of the food that they bring home. And that’s usually going to come from your produce and your bread. So if you’re not eating all of your produce, stop buying so much. If you’re finding your bread’s getting moldy, stop buying so much, they have half loaves. Now a lot of different options.
There’s a lot of competition in the food market right now. It’s starting to cool off a little bit as the money is being taken out of the system. So the competition, take advantage of it now with some of those products and test them out because you see lower prices.
But right now you want to start with focusing on your home waste, eradicate that, and then see where you can maybe cut some costs. You said meat was going up, it’s anywhere from 14 to 20%. Same thing with butter, one of my favorite things, super expensive. Eggs as well. See if you can eliminate that from your diet for a little bit or build a whole meal around something that’s much cheaper. Like if you can do like a Costco rotisserie chicken night you know that’s going to be $5.99 some sides either canned or frozen, you can get a whole family meal out of that.
So you just want to kind of change your habits and keep an eye on stuff and then have a strategy. You’re not going to find everything at the same store. Inventory is coming back a bit, but it’s still not quite there. Especially with the war in Ukraine. We’re seeing pasta shortages, things like that. You want those fun shapes. I’m not going to really be able to find it for you right now. You’re gonna get some penne usually.
So you just want to kind of look for some other options. See if you can cook with legumes and like I said with a competition, that competition is going to be in these interesting food areas like simulated chicken nuggets. They’re gonna offer online digital coupons, a whole bunch of stuff to take advantage of. So definitely do that. Just keep her eyes open, have a plan and watch your waste.
Q: Are people buying generic brands more?
Yes, huge increase in popularity of generic brands, even myself personally. I used to be a name-brand guy, like I could taste the difference. Nowadays, you really are getting really good at not being able to taste a difference when you’re talking about even like cereals and all the brand versus a name brand. But when you’re talking about like these cool new sauces and things you know, like Kroger Mariano’s has these new burger toppings and jams and jellies, different stuff to use, and they’re usually at a lower cost because of transportation costs are not, you know, coming across from great distances to get it into the shelves.
This is part of “Morning in America’s” Economic Brain Room.