According to the data provided by the Bureau of Labour Statistics, food prices have continued to increase for the last six months, whereby prices have risen to 0.6% in June. This has subjected much pain to many American families despite living in the middle of lockdowns and layoffs. The increase in food prices has occurred as consumers’ wallets are being hit hard by the pandemic compared to the price increase in March when lockdowns began. Besides, the higher prices have come as more workers are being sent back home due to the closure of restaurants, creating more pressure on families trying put food on their table. Additionally, the weekly government assistance of $600 due to the pandemic is set to expire. Americans are avoiding large expenses on food, such as buying the meat whose price is relatively high. The higher increase in meat prices in June has greatly been led by the closure of packed meat processing plants due to coronavirus infections and deaths among workers.
The increase in demand for food products has emerged as a relatively high number of consumers have limited their number of trips into the supermarkets to avoid infection with coronavirus. As a result, this has led to high supermarket bills due to increased demand for food products, but consumers have minimized their access to the products. Social distancing and travel restrictions have also sapped demand for services like eating out at restaurants and entertainment, whereby the effects have been reflected in the inflation data.
Initially, the increase in food prices was led by the closure of the borders that contributed to the consumers’ panic-buying of foodstuffs, causing a temporary spike in prices of various foodstuffs. The continued increase in demand and reduced supply led to a larger-than-expected price hike for foodstuffs in June. Besides, the supply bottlenecks of food products and other products are expected to continue causing the supply of some goods as the pandemic persists.
To revive the country’s economy and reduce the increased food prices, the supply of foodstuffs should rise by easing the lockdowns and putting a restriction on gatherings. Restaurants will be able to reach out to food consumers and meet their demands. Besides, there will be enough supply of foodstuffs that will meet the demand of consumers.