Talking turkey

Thanks to increasing energy costs and world food demands, Thanksgiving dinner is going to cost a little more than last year, says Purdue University agricultural economist Corinne Alexander. "Food prices in 2007 are up across the board," she says. "What we've seen happen in 2007 is different from previous years. This year we're seeing food prices increase at a rate of 4.4 percent, which is well above the 10-year average of 2.6 percent. In general, food price inflation is lower than the rest of inflation, but this year that's changed." On top of the overall increase, some food items have seen even larger price hikes: dairy prices are up 15 percent from last year and egg prices catapulted 45 percent. A worldwide wheat shortage has added to the cost of wheat-based foods, up as much as 10 percent. In addition to increasing food prices, energy costs have risen as well. "Energy prices have been up for the last few years, and that increases the cost of manufacturing and transporting food," Alexander explains. "As a result, we're seeing food retailers passing on these higher energy costs to consumers." Strong economic growth around the globe has resulted in higher demand for American agricultural products, which also contributes to the higher prices U.S. consumers will see this holiday season. "Economies around the world are growing, so people worldwide have more money to spend on food," Alexander adds. High demand worldwide is slightly driving up wholesale turkey prices. The USDA currently predicts that turkey wholesale prices will be between 90 and 94 cents per pound. For those families who enjoy other traditional holiday foods, turkey may not be the only place they see some relief. Many families' Thanksgiving meals include traditional favorites like mashed potatoes, sweet potatoes and cranberries. "We're expecting white potato prices to be down as much as 5 percent this year because the potato crop is much larger than what it was last year," Alexander says. "It also looks like there are going to be plenty of sweet potatoes out there, so prices should be about the same as last year. The same goes for cranberries." Happy Thanksgiving!