Exclusive: Higher grocery prices to bite Thanksgiving: survey

LOS ANGELES Thu Nov 18, 2010 4:46pm EST

A man walks past packaged fruit and vegetables during the opening ceremony for Tesco's Fresh & Easy Neighborhood supermarket in Los Angeles November 7, 2007. REUTERS/Lucy Nicholson

A man walks past packaged fruit and vegetables during the opening ceremony for Tesco's Fresh & Easy Neighborhood supermarket in Los Angeles November 7, 2007.

Credit: Reuters/Lucy Nicholson

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LOS ANGELES (Reuters) - Higher prices for supermarket staples like meat, vegetables, butter, eggs, milk and bread threaten to take a bite out of this year's Thanksgiving dinner plans, a survey showed on Thursday.

Almost 70 percent of U.S. shoppers have seen grocery prices rise in the past few weeks, according to an online survey of 637 people conducted for Reuters by SupermarketGuru.com, a website that spots trends and helps shoppers make informed food decisions.

Those higher prices have one-in-four respondents planning major changes to their Thanksgiving dinners. Almost 20 percent said they would prepare less food, while 15 percent said they intended to eat the traditional turkey dinner at a friend's or family member's house.

"It appears that many shoppers already have noted 'sticker shock' in the supermarket aisles," said Phil Lempert, SupermarketGuru.com's editor. He expects grocery prices to keep rising at least through Spring 2011.

Costs for U.S. food staples are rising after tumbling during the financial downturn. Still, supermarket operators have been reporting weak to nonexistent inflation.

That's partly because packaged food makers have been reluctant to pass their higher costs to a public scarred by job losses and reduced home and investment wealth.

Those trends were reflected in the survey results. Respondents most often reported seeing higher prices for items like beef, vegetables, butter, eggs, chicken, milk, bread, coffee, cheese, fruit and bacon.

Eighty-five percent said they were buying sale items to compensate for the higher food prices.

Lempert said that means diners should expect this year's Thanksgiving table to be a potpourri of mismatched foods and side dishes.

"Sure, the basics will all be there -- the turkey, stuffing and sweet potatoes -- but expect some of the other nonessentials to be chosen on price, not tradition," he said.

Recent news also suggests that shoppers should have plenty of sales to choose from.

Grocery chain Supervalu Inc in October said it was preparing a new round of price cuts to win back lost customers, crushing hopes that the grocery industry could end a price war that has dented profits in the last few years.

Other money-saving solutions cited by shoppers include using coupons, making lists and shopping multiple stores.

Slightly more than two-thirds of shoppers said they were buying cheaper food and 11 percent said they were eating less.

Results from a separate survey conducted on Reuters' behalf showed that more people plan to give food or restaurant gift cards as holiday gifts this year than in 2009, underscoring the economic straits of many people in the United States.

(Reporting by Lisa Baertlein. Editing by Robert MacMillan)

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