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Thread: Frugal U.S. consumers make it tough for food companies to raise prices

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    GuncoHolic Black Blade's Avatar
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    Default Frugal U.S. consumers make it tough for food companies to raise prices

    Frugal U.S. consumers make it tough for food companies to raise prices



    Snippit:

    Consumers "have gotten really good over these last four years at stretching a penny," said Pat Conroy, leader of the U.S. consumer products practice at Deloitte LLP. Referring to the recession, he said, "Our hypothesis was that this thing was going to leave a scar, not a bruise. So far, we've been right."

    According to Deloitte's annual survey of food shoppers released last week, 94 percent agreed they would remain cautious and keep spending at the same level even if the economy improves. That's about the same percentage as it was in 2010 in the aftermath of the credit crisis.

    The wholesale price for beverage milk was about $2.10 per gallon in May, a record, and up 38 percent from a year ago, according to dairy analyst Jerry Dryer. In March, retail milk prices were up only 6.5 percent, suggesting that retailers are eating much of the cost increase, he said.

    INFLATION TARGET

    U.S. consumer prices rose 1.5 percent in March from the year earlier, led by food and housing rental costs. An index of inflation tracked by the Federal Reserve is running even lower at 1.2 percent, against the central bank's target of a 2 percent inflation rate.

    Many consumers are still struggling in a tough labor market. Labor force participation remains depressed. Private-sector wages were unchanged in April and over the past 12 months have averaged monthly increases of just 0.16 percent.

    "There's still a large swath of the population that just doesn't have the spending power," said Mark Luschini, chief investment strategist at Janney Montgomery Scott.

    Continued: Frugal U.S. consumers make it tough for food companies to raise prices | Reuters


    Black Blade: Many food retailers are selling less product at the same prices in the same sized packaging (just another trick to fool consumers when it comes to food rising prices). Best bet - buy in bulk for savings and stockpile long term nonperishable items while times are reasonably good for times that become financially difficult.
    When you're born you get a ticket to the freak show. When you're born in America , you get a front row seat. - George Carlin


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    Gunco Good ole boy twa2471's Avatar
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    Hell ,,even here in VT where dairy farms are king,,milk's @4.38 a gallon,,,unreal ! And was going to grab a T-bone last shopping trip,,,,14+ BUCKS A POUND!!!! No way,,,time to buy a whole or at least a half beefer I guess.

    Around here ya can't find a job no matter what ya do,,,there just isn't any to be had,,,and no ones hiring except Mc Donalds and Wal Mart then,,,only because of the high turn overs there. Jobs with a future in this area are very very scarce if not nonexistent lately , and full time jobs even more scarce. My son's been looking for over a year and with no real skills or a degree,,,,forgetaboutit !!! And even my daughter with several nursing certifications, can't even find a decent position in nursing and is working for Lumber Liquidators now,,WTF????

    With the position this country is in now I'm thinking that it's just about time to reinstate a CCC type program to get people working again and to get the infrastructure back in order. This country is hurting and not getting any better because of the POS "leaders",,??, we have in office now. They sure can vote themselves a 17-20% raise each year though ,,,while every one else has to live on 2-3% raise,,,if you EVEN HAVE A JOB!!!!

    The roads around here took a real beating this year with the consistent way below 0 degree temps this year and just 2-3 weeks ago I damn near ripped the lower control arm right out of my PT Cruiser after hitting a pot hole the size of Grand Canyon. It bent the Hell out of the control arm and tweaked the tie rod too, plus bending the sub frame and bending one of the wheels and blowing the tire right off the rim. That hole was literally 12" deep straight down and 18" wide and about 15 ' long and being behind a big truck I just didn't have time to react before I hit it. At this point with all the other stuff it needs, I'm better off just dumping it and getting something else by the time I'm through.

    More expense for me just because of the lack of funds to keep up with the roads,,how nice is that? We sure pay enough tax's in this state they should be able to keep up with them. Sadly to damn many "flatlanders" are moving in now and demanding bike trails and lanes,,,ridiculous,, main thoroughfares and truck routes are NOT the place for bike paths/ lanes !!!

  3. #3
    aka: SDK1968 dutigaf's Avatar
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    yeah milk bounces here from $3.99 to 4.19.....

    we just drink less of it.
    say what you mean & mean what you say


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    GuncoHolic Black Blade's Avatar
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    Report: Food Prices Skyrocket: “We’re Going to Have a Major Problem Coming Into the Fall”

    While government statisticians claim robust growth, recent data points suggest otherwise. Consumers are quickly running out of money, home sales have collapsed and hit their biggest drop in three years, there are more Americans out of the labor force than ever before, and one third of adults under the age of 35 are living with their parents because they can no longer afford to pay their own mortgage.

    By all accounts, the reality is that we are now factually in a recession, a point further emphasized by the recent revelation that American companies are experiencing near zero percent earnings growth.

    But that’s just the beginning. As we warned earlier this year, food prices would see a steady rise through 2014 because of increased global demand, drought and continued degradation of the U.S. dollar.

    The Producer Price Index made available by the Bureau of Labor and Statistics this morning has now confirmed those fears. Consumers are seeing an immediate impact to their wallets in the form of food price inflation and in all likelihood the trend will continue going forward.

    These latest numbers are serious. So much so that according to Zero Hedge, “the last time food prices spiked by this much in one month, the resulting Arab Spring wave of revolutions tumbled governments across north Africa and the middle east.”



    The trend over the last several months shows a clear and sustained rise in prices for food, something that nearly 50 millions are already struggling to acquire, even with assistance from the government. Now their food stamps buy even less. And if people are spending more on food, it means they’ll be spending less in other sectors of the economy.

    Karl Denninger at The Market Ticker warns that this is bad news because consumers are now paying 7.4% more for food on an annual basis than they were last year, a scenario which could lead to macro-economic repercussions by Fall.

    Food was up huge, and people will dismiss the headline 0.6% (monthly, which would be a 7.4% annual inflation rate!) on food, which of course doesn’t “hit” core.

    There’s a problem with that however – services were up the same 0.6% monthly behind an 0.7% increase last month, and “core” is up 0.3% on goods, which is a 3.7% rate of increase. This pushed the 12 month rate beyond the Fed’s 2% target.

    The next claim that will be made is that this is “transitory.” Unfortunately the intermediate (~1-3 months forward) and crude (~3-6 month forward) numbers tell a very different story.

    The intermdiate trend in foods is bad news; that is a monthly change. Energy has been the counterbalance the last two months on an intermediate term, and has kept things in check, and “less foods and energy” has been reasonably-behaved — right up until this year. Now it’s looking less-so. But the alarm bells are not there, they’re in the forward trend on the crude side.

    Here’s the problem — we’re several percent ahead of last year’s rate at this time of the year. Spring into early summer tends to have a PPI increase in crude goods. But if that spread continues we’re going to have a major problem coming into the fall as this works through the system, and given unit labor costs and productivity numbers (both going the wrong way too) there is no ability to absorb it.

    Now let me point out that we’re not quite where you have to ring the “oh crap” bell yet. There’s another month or two before that happens — but by June, if the trend we’re seeing here hasn’t broken this will get into the forward economic analysis mindspace of most of the people who look at this stuff.

    I don’t like the trend at all.

    Charts and full analysis
    Within the next couple of months we’re going to have a very good idea of where this is all headed. If prices don’t turn down, then by Fall we’re going to have a big problem:

    There is no ability in the economy to absorb such price increases as productivity and unit labor cost figures have shown. Instead, what this will produce is recession – deep recession.
    Look out below.


    Author: Mac Slavo
    Views: Read by 21,330 people
    Date: May 14th, 2014
    Website: SHTF Plan - When the Shit Hits The Fan, Don't Say We Didn't Warn You.


    Black Blade: I'm not too concerned. Lots of fish and game on my place and also have been prepped for some time:

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    Gunco Member BackAgain's Avatar
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    twa2471,

    My wife and I have started buying 1/4 of a cow and cickens from a friend of mine that has a farm. He pastures the cattle so they are grass fed and the chickens are free range. The beef is so much better than store bought beef and considering the mixture of cuts and hamburger the $3.48 a pound seemed to be a great price to me. We haven't tried the chickens yet, they were slightly more expensive than store bought but they weigh between 7 and 13 pounds. We are so happy with the beef that we have ordered a pig this year and another 1/4 beef.

    Cheaper, better quality, better for you, what's not to like?

  6. #6
    Gunco Member BackAgain's Avatar
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    Grow as much of your own food as possible. Can and freeze as much of that as possible. Buy in bulk the things you can't produce yourself. Stock up when things you like and need are on sale. Keep at least a few weeks, if not months, of food and other supplies on hand.

    We need to return to the days of our grandparents and stop living like corporations with the "just in time" style of keeping supplies on hand.

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    White Cracker 4thIDvet's Avatar
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    Drought is sadly hurting the ranchers and playing a part in our beef prices. But thank G.W. Bush II for that ethanol crap were putting in our engines. He promoted the corn oil, environmentalist promoted it. Guess what? Backfire.
    Farmers were setting aside and not growing corn on sections of their land. Prairie grasses grew and it was environmentally friendly for all. Deep rooted prairie grasses. Well hell corn commodities went through the roof with the ethanol crap, that costs $80 something dollars to manufacture.
    Was it a good idea? Yes, but it failed, so stop. Damn near everything in the store revolves around corn, enjoy beef prices $$. Thank you G.W..
    I knew him at Yale golf course as a kid. Should have sucker punched him when I had the chance, him and his dirt ball cheap skate old man.

    "The fact that most ethanol is made from corn means that an increase in the ethanol content of gas could worsen a variety of problems, ranging from higher food prices to elevated levels of atmospheric carbon dioxide. Ethanol production has also been linked to the spread of a dangerous form of the deadly bacterium E. coli.
    Some states recognize that corn ethanol is a bum deal ? High Country News

    approved a bill banning ethanol in gas and asked the federal government to do the same.



    "Maine House Republicans posted the following on Maine.gov: "Evidence is mounting that ethanol is a failure in virtually every way. It takes more energy to produce it than the fuel provides. Food supplies around the world have been disrupted because so much of the corn crop now goes to ethanol. It costs taxpayers billions of dollars in subsidies at a time when our nation is already $12 trillion in debt. Even environmentalists have turned against it; research shows that ethanol production increases the amount of carbon dioxide released into the atmosphere."
    Some states recognize that corn ethanol is a bum deal ? High Country News

    Between Nappy and crew printing and handing out worthless paper and inflation. Were F#$Ked. Prep..
    "Man needs but two things to survive alone in the woods. A blow up female doll and his trusty old AK-47" - Thomas Jefferson 1781


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    GuncoHolic Black Blade's Avatar
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    I know a lot of people have been buying grains in bulk and storing them. I have added some tan waterbricks for rice recently and some more freeze-dried fruits. I also added a case of raw bee spit (honey) from a local beekeeper. A local store had cases of canned beans (black, red, white, kidney, pinto, etc.) and corn so I picked up a few although I already had some. Makes for decent side dishes and since I rotate my inventory I don't worry much about "expiration dates" - actually I have eaten canned goods that are several years old and they are perfectly fine. I think my brother's Mormon inlaws still get bulk grains from the LDS warehouse-cannery in Idaho so I may have to see about putting in an order. I know they stopped canning ay most of their warehouses due to Federal Government regs but still sell #10 cans of dry pack foods and maybe bags of grains and beans.

    I would garden but am never home long enough to tend to the plants and to water them sufficiently. Have plenty of fish and game on my lands so I already have a steady supply of essentially "free" protein. I may have to go in on a hog and a steer with my brother again this year and maybe another buffalo (usually get one every other year or so).

    I have been living off my storage for the last couple months now so my food bill is very small. In my east cabin I have room for some 4' shelves to stock up canned and boxed foods and I have a nearly empty shop with built in shelves on my property I could use as well and a similar set up at the west cabin where I have shelves stacked with cases of Mountain House freeze-dried food and canned cheese and butter. I have also checked out some beekeeping supplies that a local ranch store now carries and if I was home more often I could do bees as I am uphill from a couple ranches (alfalfa fields in valley below). I would like to get back into making mead again if the SHTF and had time on my hands.

    - Black Blade

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  9. #9
    aka: SDK1968 dutigaf's Avatar
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    grew up on a small farm.... so its not ever gonna be a problem of not knowing how.. but until i HAVE to... those days are over...

    now as to meat? we are over run with game animals here & my entire family likes all types of game. we be good to go.
    say what you mean & mean what you say


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    GuncoHolic Black Blade's Avatar
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    Meat Prices Surge Most In 11 Years



    READ MORE ...
    When you're born you get a ticket to the freak show. When you're born in America , you get a front row seat. - George Carlin


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