by Lesly Gissell Zhicay
Much like me, you were probably astonished when the price of eggs reached nearly $10 for a dozen of eggs. As a signature breakfast staple or just on its own, many of you may have wondered why such a basic necessity reached nearly unimaginable price increase. Now many of you may have seen these grocery price increases as inevitable consequence of the increasing inflation that we are seeing across consumer goods however, further research reveals massive profits for major agribusiness conglomerates.
As seen above, almost all major grocery prices have increased in the past year. Many major food companies have cited inflationary pressures as the reason for increasing prices, however a recent article done by Vox revealed that many agricultural commodities prices have gone down and inflation in 2022 outpaces the rise in wages (Kim). Vox further found that many major food companies nearly doubled their profits in the past 2 years with many major food billionaires growing exponentially wealthier (Kim).
Similarly, Times found similar profit gains for major egg retailer, Cal-Maine. Cal-Mine controls 20% of the retail egg market and recently reported gross profits of more than 600% over the same quarter than the previous year (Popli and Burga). While the company has city a degree in egg supply nationwide due to avian flu, Cal-Maine did not test positive for avian flu tests on any of its’s farms (Popli and Burga. Leading many food advocated such as Farm Action to believe that major companies are using supply chain disruptions as a way to gouge consumers (Popli and Burga).
Similarly Whizy Kim cites food monopolies as the major reason why corporations are able to get away with price increase. At this time four major agribusiness control nearly 70% of the worlds agriculture market (Kim). What is even more alarming is that the ongoing merger between two major grocery retailers Kroger and Albertson merger would lead Walmart and Kroger to control over 70% of the food industry (Kim). With this much control over the market, businesses can have ultimate control on food prices with little competition.
While this may paint a bleak picture, it is an important one we must recognize as we navigate this high inflation era. In an upcoming blog we hope to provide you with some tools to manage the increasing grocery expenses.
Sources:
Kim, Whizy. “Prices at the Supermarket Keep Rising. so Do Corporate Profits.” Vox, Vox, 17 Mar. 2023, https://www.vox.com/money/23641875/food-grocery-inflation-prices-billionaires.
Popli, Nik, and Solcyre Burga. “Here's Why Grocery Store Prices Are so High Right Now.” Time, Time, 28 Jan. 2023, https://time.com/6250895/grocery-prices-rising-inflation/.
Popli, Nik. “Food Company Profits Are Making Groceries More Expensive.” Time, Time, 6 Apr. 2023, https://time.com/6269366/food-company-profits-make-groceries-expensive/.