Consumers should be able to afford their Thanksgiving dinner this year, the fuel to cook the feast and the gasoline to drive it to grandma’s, said a Purdue University agricultural economist.
Food and beverage prices are up 2.6 percent this holiday season, while gasoline and natural gas prices are much lower, said Corinne Alexander.
“Food price increases so far in 2006 have been about average, with abundant supplies of many food products,” Alexander said.
“We’ve seen a decline in dairy prices. Milk and butter are much cheaper this year than they were even two years ago. We’ve also seen an increase in the cattle herd nationwide, so beef prices have moderated. And while there has been hot weather that has damaged fruit and vegetable crops, we haven’t had the same number of hurricanes this year as we’ve had in recent years. So that’s helped in terms of fruit and vegetable prices.”
Whole milk prices are down 3.4 percent, with butter 6.4 percent less expensive than last fall, Alexander said. Fruit and vegetable prices, while less volatile this year, are up 6.5 percent.
Turkey production is slightly ahead of 2005, although stocks are not as great, Alexander said.
“We have very tight supplies of turkey nationwide, so wholesale prices for turkeys are up about 3 cents a pound from last year,” she said. “However, we tend to see grocery stores lure shoppers into their stores with deals on turkey. So whatever wholesale prices happen to be for turkey doesn’t necessarily mean that prices are going to be higher at the retail grocery store level.
“Grocers oftentimes are willing to sell turkey at wholesale cost or below wholesale cost to get shoppers into their stores to buy potatoes, cranberries, sweet potatoes, pumpkin pie ingredients and all the rest.”
Consumers have more choices for their Thanksgiving turkey than just a frozen bird. Many grocers are offering free-range and organically raised turkey.
“A new trend is pastured poultry,” Alexander said. “A consumer can go to a farm and choose their bird while it is walking around the pasture, watch it grow up and then it becomes their Thanksgiving bird.”
Regardless what’s on the menu, energy prices should give consumers something to be thankful for this holiday.
“One thing that’s exciting for holiday travelers this year is that energy prices have fallen quite substantially from last year,” Alexander said. “Gasoline prices are down 18 percent, which means that your Thanksgiving travel will be a lot more affordable. At the same time natural gas prices are also lower, so if you’ve got a stove powered by natural gas it will cost less to cook your turkey.”