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HOLIDAY BAKING COSTS UP

Like many basic goods used in holiday dishes and recipes, prices for potatoes are higher this year. LAURA McKENZIE | AGRILIFE

Bakery products up 16.2 percent in past 12 months

ADAM RUSSELL | AGRILIFE

Holiday baking will be more expensive this year as basics like milk, eggs, flour and sugar, as well as some popular sides, have all risen since last year, according to a Texas economist.

David Anderson said grocery shoppers will not be surprised that costs have risen.

The Oct. 13 Bureau of Labor Statistics Consumer Price Index showed the index for food at home rose 13 percent over the last 12 months. The index for bakery products increased 16.2 percent over the year, while the index for eggs increased 9 percent and dairy and related products rose 15.9 percent.

U.S. Department of Agriculture retail reports also indicated similar price increases on basic grocery products in demand during the holidays.

“Prices on most things we cook with are up, and that means holiday lunches and dinners are going to cost more,” he said. “It’s hard to say how much of these higher prices are related to Mother Nature – drought and avian flu – or bottlenecks at ports or labor and fuel costs or the Russia-Ukraine war or companies raising prices because they can.”

Some of these typical baking items are higher due to production issues caused by Mother Nature, while others are rooted in supply/demand market factors.

Egg prices have been rising since spring and are more than $1 higher per dozen – $2.90 versus $1.84 – last year due to avian influenza’s impact on production, Anderson said. The highly pathogenic viral disease hit the U.S. poultry industry this spring and continues to be an issue on commercial farms.

The USDA-Animal and Plant Health Inspection Service reported more than 49 million commercial poultry birds, including broiler and egg-laying chickens, turkeys and various fowl have been lost to the virus, now reported in 46 states.

The deadly disease hits egg-laying chicken flocks harder because birds are in production much longer than broiler chickens, which increases their risk of exposure to the pathogen. 

“Eggs are in a lot of holiday recipes, and demand goes up this time of year because of that,” Anderson said. “Eggs will be more expensive this year, but the avian flu outbreak is one of those things that is out of our control.”

Other items used heavily in holiday recipes such as milk, cheese and butter have all experienced tighter dairy supplies this year while consumer trends on products like butter show increased demand, he said. Butter is $4.44 per pound compared to $2.83 per pound last year.

“There has been continued growth in demand that is constrained by milk production and production of these milk-based products,” he said. “With butter, we are seeing people are using the real thing more. There has been a pendulum swing toward clean labels, and consumers want a natural product.”

The retail price for a gallon of whole milk in Dallas was $3.29 in October last year and $3.88 this year, according to the USDA.

Most other basic holiday baking items increased in cost, according to USDA retail reports and the Consumer Price Index.

Anderson said other items like cranberries, sweet potatoes and potatoes are all up slightly while prices for sweet onions are down 1 cent compared to this time last year. Some fruit and vegetable varieties, like Russett potatoes, which are $3.26 per 5-pound bag compared to $2.24 for the same bag last year, increased more.

Sugar and other sweeteners are up 17 percent compared to last year, according to the consumer price index. Flour and prepared flour mixes are more than 24 percent higher than a year ago.

Despite across-the-board price bumps on a range of items that frequent Thanksgiving and holiday meals, Anderson said the overall price increases are not as dramatic in the context of making a meal for a large family gathering.

For example, based on the 13 percent overall index for food at home, $100 spent last year would cost $113 this year.

“I know that higher costs for everything are hitting a lot of people hard, especially going into the holidays,” he said. “All these 20 cents here and a dollar there increases add up. But I don’t think they are enough to drive most consumers away from the traditional recipes and dishes they serve at lunch and dinner gatherings.”

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