COVID-19 supply, demand issues push largest grocery price hike since 1970

AMES, Iowa -- Grocery prices across the country last month saw the largest increase in nearly 50 years.

One of the reasons for the increase--demand for food at grocery stores increased as restaurants, schools, and other meal sources were closed by the COVID-19 pandemic.

"That transferred a lot of that food being demanded away from home to at-home--which meant grocery stores. We are seeing more demand a grocery stores, and any time you see higher demand it tends to drive up prices" says Iowa State University Agriculture Economist Chad Hart.

He also says there were also COVID-19 related problems in food supply.

"We've seen supply restrictions not only at the meat processing plants, but you're also seeing it in other areas of food processing. I think Birdseye had a couple of plants go down for awhile because of COVID-19" Hart says.

He says that price hike is likely being felt in the Midwest.

"I'm going to guess, anecdotally, that we are seeing some of the pressure. It's going to vary, literally, location to location. It just depends upon what your grocery store chain was able to obtain in that week" Hart says.

According to the BLS study, US consumers paid 4.3 percent more in April for meats, poultry, fish and eggs, 1.5 percent more for fruits and vegetables, and 2.9 percent more for cereals and bakery products.

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