It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
(visit the link for the full news article)
WASHINGTON (Reuters) - U.S. food prices will rise a stiff 9 percent a year through 2012, the largest increase since 1979 and the result of record-high crop prices, the head of an economic consulting company said on Thursday.
The projections by Bill Lapp of Advanced Economic Solutions are higher than the latest U.S. Agriculture Department forecast of 5 percent for this year. USDA and Lapp have increased their estimates by 1.5 percentage points since February.
During a telephone news conference, Lapp said he was completing a new analysis of food and commodity prices. He foresaw average corn prices of $5.25 a bushel through 2012, with wheat around $6.50 and soybeans near $11.
Lapp was chief economist for ConAgra Foods Inc, one of the largest U.S. foodmakers, before opening his consulting firm which is based in Omaha, Nebraska.
A 9 percent increase would be the largest since 11 percent in 1979. Lapp spoke during a teleconference sponsored by the Environmental Working Group.
Americans spend more than $1 trillion a year on groceries, snacks, carry-out food and meals at restaurants.
Food prices rose by 4 percent during 2007, says USDA, ending a long stretch when food price inflation stayed below the overall U.S. inflation rate. Lapp puts the 2007 increase at 4.9 percent. He initially forecast an increase of 7.5 percent this year and through 2012.
Ephraim Leibtag, the USDA economist who tracks food prices, said separately that grocery prices traditionally reflect a small fraction of upswings in grain prices. "The question ... is how much and how quick" grocery prices are adjusted due to higher prices for raw materials, he said.