Inflation appears to be slowing down, perhaps a sign that the Federal Reserve’s raising of interest rates is having the desired effect.
But when shopping for groceries, most of us are still seeing sticker shock. Prices for eggs rose nearly 90% from October of 2021 to last month. Boneless chicken breast? Up nearly 30%. The cost of chips is up more than 20% from last year, too.
Why did everything get so expensive?
“The pandemic itself is a factor, but it’s not the only factor,” said Yaa Opoku-Agyeman, an economist at the Bureau of Labor Statistics, which tracks grocery prices across the U.S. She notes that food prices in 2020, the year the pandemic began, were not as high in the Baltimore area as they were in 2021 and this year. In fact, over the past year, according to the bureau, the food index, a metric that includes average prices of both food and beverages consumed at home and out of the house, rose 13% in the Baltimore area, the biggest jump since 1999.
Some causes? In addition to the pandemic, avian flu and environmental factors like drought have helped drive up prices for chicken and potatoes. Labor and shipping costs, too, have risen, as has overall demand.
Another problem, said Amanda Starbuck, research director at the nonprofit Food & Water Watch, is increased consolidation as companies scoop up their rivals. Her group has warned of risks in the upcoming merger between Kroger and Albertsons, which she says will reduce competition between outlets. Albertsons owns Safeway, Balducci’s and other well-known brands with outlets in the Baltimore area, while Kroger owns Harris Teeter. Having many regional retailers owned by the same company creates “an illusion of choice,” she said.
Is there a light at the end of the tunnel? Maybe. “If you look at the high inflation numbers for July and August, there’s a notable decrease” towards the end of the year, Opoku-Agyeman said. “Whether or not that continues, we would have to wait and see.”
Unfortunately for consumers, high prices have a tendency to stick around even after inflationary pressures decrease, Starbuck said. Economists even have a name for the phenomenon: sticky inflation.
In search of a good deal, more shoppers are turning to retailers like Aldi and Lidl, whose cut-rate prices are at the core of their brands. The relatively no-frills stores offer a somewhat limited selection of products, and rely heavily on private label or store brands in place of better-known options. Such options are growing in popularity across stores and tend to be more affordable than name brands.
Aldi and Lidl “kill it on pricing,” said Jeremy Diamond, author of “Tastemakers: The Legacy of Jewish Entrepreneurs in the Mid-Atlantic Grocery Industry.”
Diamond hopes that the lower prices of the two newcomers will force other grocery store chains to take notice and offer similar discounts. “Conventional grocers keep tabs on the competition,” said Diamond, whose family ran a chain of grocery stores in the Baltimore area for years. “I hope that they take note of Lidl and Aldi and all the other price-point-conscious grocers out there.”
Amid rampant inflation and fears of a looming recession, Diamond said, “Price is now at the top of the list. I think it’s going to stay at the top for a while.”
To help readers of The Baltimore Banner make informed decisions about grocery shopping, we compared prices at area grocery stores, including Weis Markets, Trader Joe’s, Whole Foods, Lidl, Aldi, Giant, Wegmans, Safeway, Harris Teeter and ShopRite.
We came up with a shopping list of products that we commonly eat in our own homes:
- Sandwich bread, one loaf (Old Tyme Honey Wheat, where available)
- Eggs, large white, one dozen
- Jif creamy peanut butter, 16 ounces
- Canned green beans, 14.5 ounces (Del Monte French style, where available)
- Chicken thighs, bone-in, skin-on, 1 pound
- Ground beef, 80% lean, 1 pound
- Whole milk, non-organic, one gallon
- Bananas, 1 pound
- Butter, unsalted, 1 pound (Land O’Lakes, where available)
- Utz chips, 8-ounce bag
- Sugar, 4-lb. bag (Domino, where available)
- Old Bay seasoning, 6-ounce canister
And we got to shopping.
While we looked for consistent brands and sizes for products, that wasn’t always possible. Many stores use generic, or private labels, to keep prices down. In those cases, we went with the closest available substitute. Whole Foods doesn’t carry the 8-ounce bag of Utz chips we were looking for, so we used their 10-ounce bag of 365 brand kettle chips.
Though many stores have special pricing for club members, we chose to use the base, non-sale price for each item. For example, while Giant was advertising a two-for-$6 special on granulated sugar for their members, we went with the $4.69 standard price.
Our findings don’t offer a comprehensive look at store prices — which fluctuate over time — but rather a glimpse of where things stood over one week this month.
Here’s what we found:
Certain products have solid consistency in pricing across stores. The cost of bananas was often exactly $0.59 per pound or around that mark, whether at ShopRite or Harris Teeter. Trader Joe’s tells shoppers that their bananas have been the same price for 30 years: $0.19 each. When you consider that there are about three bananas in a pound, the price per pound comes to $0.57, which is in line with other stores. Safeway was the outlier, selling bananas at the comparatively high price of $0.69 per pound.
Other items, such as butter, chicken and eggs, can have a lot more variation in pricing. One pound of Land O’Lakes butter costs $8.49 at Harris Teeter in Locust Point in Baltimore, but just $4.99 per pound at Wegmans in Hunt Valley.
Stores tend to compensate for one high-priced item with lower prices on others. For example, while the butter was more expensive than average at Harris Teeter, that store also offered one of the lowest prices for ground beef: just $3.99 per pound. That led to perhaps less variation than one might expect in overall check totals, with most store totals falling somewhere between $40 and around $47.
Among stores, advertised prices can be misleading. While most people are in a hurry to load up their carts, they might not think twice about a 4-pound bag of granulated sugar at Lidl advertised for $1.69. But look closer and you’ll notice that price is only for those who have downloaded the myLidl app. The regular price is $2.39.
While Trader Joe’s offered low prices on many common products, including eggs, peanut butter and chicken thighs, it was hard to draw a realistic comparison to the other stores since their stores didn’t carry two products on our shopping list — Old Bay seasoning and canned green beans. Our checkout total came to just $31.77 on a trip to Trader Joe’s, but we left without two items we needed.
Overall, two stores left us with considerably more money in our wallets. Lidl, and particularly Aldi, beat competitors nearly across the board.
A billboard for Lidl advertises “suspiciously low-priced groceries.” A sign inside an Aldi store in Baltimore County features claims that a woman halved her grocery expenses by shopping at the store. While our trip suggests you might not save quite that much, you could get close to it. Our check total when shopping at Aldi was just $26.52, while the average check total for all of the other stores on our list, minus Aldi, Lidl and Trader Joe’s, was around $45.
Data visualizations by Emma Patti Harris