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GROCERY-WATCHER DOESN’T SEE BIG RISE IN FOOD PRICES FOR ’90

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No flat predictions yet, but one of the Agriculture Department's chief grocery-watchers thinks consumer food prices in 1990 won't go up as fast as they did this year.

Food prices did rise sharply in 1989, an average of "around 6 percent" over the calendar year, economist Ralph L. Parlett Jr. says, adding that not much is in the works over the next couple of months that will alter that preliminary reading.According to USDA records based on official Labor Department statistics, this year's 6 percent all-food increase - which includes meals eaten out as well as at home - is the biggest gain since a 7.8 percent jump in 1981.

Retail food prices averaged 4.1 percent higher in each of the last two years and had hovered at or below that level since the hefty 1981 increase.

Parlett, interviewed by telephone last Friday, said he was in the midst of preparing the 1990 forecast for release at the department's annual outlook conference in late November.

"I don't think there'll be the increase we've seen this year," Parlett ventured. "It's not going to be near the 6 percent level . . . I don't think."

Although Parlett said the 1990 food outlook is still a bit cloudy, there are some points that can be made about this year's situation and how those might bear on the immediate future.

"Some of our price increase this year was caused early on by bad weather, with vegetables, particularly," he said. "We don't forecast bad weather for 1990, so maybe that's one thing that won't happen, hopefully."

Parlett added: "But we still have the carryover from the (1988) drought that left a lot of pipelines empty, in terms of the processed vegetable market. Prices will be high, and supplies are still going to be tight."

Despite "a respectable harvest" of vegetables this year, supplies for processing will be tight as inventories continue to be replenished, he said. But this will gradually be corrected.

"Come next year there's no reason to see those vegetable prices - processed or fresh - to be screaming higher," Parlett said.

Meat, poultry, fish and eggs account for more than 30 percent of the Labor Department's food-at-home price index, based on December 1988 computations.

By comparison, cereals and bakery products are about 14 percent of the index; dairy products, 12 percent; fresh fruits and vegetables, 11 percent; and processed fruits and vegetables, 7 percent.

Red meat supplies, mostly beef and pork, probably will decrease slightly in 1990, he said. But there is uncertainty about what will happen to prices, partly because poultry has an impact on beef and pork, and vice versa.