U.S. Consumers Burdened by Ballooning Food Prices

food prices
Busy supermarket | Image by Tom Werner/Getty Images

With food prices in the U.S. already through the roof, federal regulators are considering whether a proposed merger between rival grocery chains Kroger and Albertsons would worsen the issue.

The Federal Trade Commission (FTC) is seeking to block a nearly $25 billion merger between Kroger and Albertsons over concerns that the proposed deal would result in higher food prices and less competition, The Dallas Express previously reported.

While the two grocery chains have argued that the merger will lead to lower costs, federal regulators claim the deal would negatively impact consumers already dealing with higher prices for milk, bread, eggs, etc.

“This supermarket mega-merger comes as American consumers have seen the cost of groceries rise steadily over the past few years. Kroger’s acquisition of Albertsons would lead to additional grocery price hikes for everyday goods, further exacerbating the financial strain consumers across the country face today,” said Henry Liu, director of the Federal Trade Commission’s Bureau of Competition, in a press release.

“Essential grocery store workers would also suffer under this deal, facing the threat of their wages dwindling, benefits diminishing, and their working conditions deteriorating,” he added.

U.S. consumers have generally watched their grocery bills skyrocket over the last four years.

According to the Bureau of Labor Statistics, the cost of food at home, including grocery or supermarket food purchases, has risen by more than 25% since January 2020. Furthermore, the average American spent 11.3% of their disposable personal income on food in 2022, levels not seen since the 1980s, according to data from the U.S. Department of Agriculture.

Cash-strapped consumers have had to make various financial sacrifices to account for the higher food prices. Such sacrifices include reducing the number of times U.S. consumers eat out each month, buying discounted or on-sale food items, sharing meals, and more.

Kellogg’s CEO Gary Pilnick recently came under fire for suggesting that struggling families eat cereal for dinner.

“If you think about the cost of cereal for a family [for dinner] versus what they might otherwise do, that’s going to be much more affordable,” said Pilnick in an interview with CNBC.

A new study by the Buckeye Institute details how President Joe Biden’s expensive climate and emissions policies have devastated U.S. farmers and made food prices far more costly. The report suggests that more price hikes are around the corner if the Democrats win the presidential election in November.

“Federal policymakers are pursuing expensive climate-control and emissions policies that have largely failed in Europe — and the American farm and household will be required to pay for them,” the study reads.

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