What's up with the skyrocketing grocery prices — and when will it all stop?

Experts warn we won’t see a return to previous conditions any time soon, and it will take time for the supply chain to adjust to “the new normal.”

Breaking News Emails

Get breaking news alerts and special reports. The news and stories that matter, delivered weekday mornings.
SUBSCRIBE
By Ben Popken

Consumers frantically rushing through the grocery stores like a coronavirus version of the hit TV game show “Supermarket Sweep” now have another challenge to deal with: skyrocketing prices.

April grocery prices shot up to the highest levels since February 1974, with meat, poultry, fish and eggs increasing the most, according to the latest Consumer Price Index released by the Bureau of Labor Statistics.

Eggs were up 16 percent. Pork roasts, steaks and ribs, up 10 percent. Fresh whole chicken, up 7 percent.

It’s enough to make shoppers want to tear up their receipts. But there is some relief: Fresh cakes and cupcakes were down over 2 percent, prepared salads down over 3.5 percent, and ham was down 1.7 percent.

The price fluctuations come after coronavirus sent panicked shoppers now eating all their meals at home to stock up all at once and at the same time scrambled the supply chain’s ability to stock shelves.

Demand for eggs is so high that some stores have resorted to rationing customers to two dozen per shopping trip. Prices have risen accordingly.

“The food supply chain is based on the velocity of inventory turns,” said Matthew Caito, an operations management professor at Butler University. Once parts of the flywheel stop turning, the whole thing seizes up.

Eggs and dairy are both dependent on refrigerator space by intermediaries and available consumer packaging containers. When those run out, after about a week the goods must get tossed.

Meat-packing plants built around cramming as many cutters and processors into as tight a space as possible have closed or dramatically reduced the number of workers per shift. That’s reduced the amount of case-ready pre-packaged meat available — at the very same time as customers have shifted their meat consumption from the shut-down restaurants to homemade meals. Larger cuts intended for the restaurant market could get redirected to stores but require an intermediate processor, whose availability is getting swooped up. Stores could butcher their own cuts in the back, but many stores trimmed their meat departments to stay competitive.

Shoppers can keep their grocery bills down by following some of the classic savings advice. Buy in bulk. Plan meals ahead of time. Use packaged foods sparingly. Look for unused ingredients you already have and combine them, for instance using a “recipe spinner” app to come up with ideas. Support your local farmers.

Some local butchers and intermediate processors are booked solid for the rest of the year for freezer beef and pork, AgWeb reported. Some meat producers are reportedly even giving away entire hogs for free or selling them at a steep discount.

Logistical snarls and backups have led to unlikely extremes. On one end, long lines and some items missing on shelves. On the other, farmers letting food rot or simply giving it away, like the potato grower who gave away 2 million russets. Social media shows empty store refrigerators and commercial producers dumping milk down drains.

Manufacturers say they’re doing everything they can to keep up with the increased demand that is in part due to consumers eating nearly all of their meals at home and some stocking behavior.

“There is definitely increased demand for our brands in the frozen aisle,” said ConAgra spokesperson Daniel Hare. “Our plants are operating efficiently and near full capacity to provide people with the food they need during this unprecedented time.”

Experts warn we won’t see a return to previous conditions any time soon and it will take time for suppliers and the supply chain to adjust to “the new normal.”

“We are certain to see negative ripples for months to come,” said Caito.

There won’t be empty supermarkets but they may have less selection than shoppers are used to.

Shoppers say that with their entire family sheltered at home they have little choice but to pay the prices.

“I’m not going to worry about prices increasing until it happens. I’m not stocking up more than I have in the past,” said Jason Greene, a stay at home father in New York City. “With four kids, I go through a lot normally. I do not believe there will be a major food shortage, but we might need to put our privileges aside,” for instance, making do with substitutions.

More impacts could come later in the year. In the next three weeks, over 80 percent of all acres in North America will be planted. Problems could crop up during harvest time. If restrictions impede the ability of farm workers to move across state lines, there could be labor shortages.

“Laborers generally live in close quarters,” said Decker Walker, a managing director at The Boston Consulting Group. . “If those laborers are out of work, we could have issues.”