President Biden is getting bad advice in painting the meat and poultry industry as a villain behind sharply higher grocery prices, said the president of the National Chicken Council in an essay published on the chicken-raising Delmarva Peninsula. "This administration has chosen to put politics above protein," wrote Mike Brown, the trade group president.
Acknowledging "we need to get inflation under control" as part of the economic recovery from the pandemic, President Biden said on Wednesday that the administration will inject competition into the highly consolidated meat industry to bring down prices at the grocery store. Meat prices soared by 14.8 percent during 2021, part of overall food inflation of 6.3 percent.
Meat prices fell in the final weeks of 2021, but food inflation climbed again, to an annual rate of 6.3 percent, said the Labor Department on Wednesday. The overall U.S. inflation rate of 7 percent for the past 12 months was the highest since June 1982.
World food prices soared by 28 percent during 2021, according to an index based on five major commodities, including cereal grains, meat, and sugar, said the UN Food and Agriculture Organization on Thursday. The abrupt increase, as the world recovered from the economic collapse that accompanied the pandemic, ended five years of relative stability in the Food Price Index.
Pushed by high meat prices, the Food Price Index will surge by 3.5 percent this year, its largest increase since the 5.5 percent rise in 2008, said the USDA on Tuesday. Food prices typically rise about 2.4 percent a year.
Grocery prices are climbing at their fastest pace since 2008, with beef, pork and poultry leading the way — up nearly 13 percent since last November, said the government's new inflation report. The White House pinned the blame for surging meat prices on meatpackers "taking advantage of their market power to raise prices while increasing their own profit margins."
Strong consumer demand for meat and labor shortages at packing plants were factors in persistently high meat prices this year, said the USDA on Tuesday in a monthly report on food inflation. Meat prices were forecast to climb by 6.5 percent this year, double its long-term average of 3.2 percent annually.
With the U.S. inflation rate at 6.2 percent — the highest it's been since 1990 — President Biden said the government was on the alert for price gouging as it worked to remove bottlenecks in the supply chain. Inflation has been on the rise since February, and soaring food prices, often led by meat, are an important factor.
Beef prices were 12 percent higher than a year ago, helping to drive overall food prices upward, said the Labor Department on Tuesday. The monthly Consumer Price Index report said food prices were 3.7 percent higher but the U.S. inflation rate slowed slightly in August.
Americans will see the second year in a row of larger-than-usual food price increases, with food inflation now forecast at 3.5 percent this year, following the pandemic-driven 3.4 percent increase of 2020, said USDA economists on Thursday.