Cut Your Grocery Bill In Half! with Stephanie Nelson, The Coupon Mom
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How to Fight Increased Food Prices Expected From This Summer’s Drought

By Stephanie Nelson, www.CouponMom.com

Economists project that because 65% of the US crops have been affected by this summer’s drought, US consumers can expect to see an increase in grocery prices of 2.5 to 3.5% in 2012, and 3-4% in 2013.  The items that will see the greatest increase initially is chicken and turkey, expected to increase 4.5%.  Other items that are expected to go up in price include milk, fruit, beef (4-5%), eggs (1-2%) and cooking oil (4-5%) due to the hit to soybean crops, the main ingredient in cooking oil.

Although the prices of many items will likely see a slight increase, the highest-impact items in most households’ budgets will be the main dish ingredients like chicken, beef, turkey and pork.  I’ll use chicken as an example here, and keep in mind that you can use this same approach with any grocery item.

For most shoppers, this increase may prompt them to start using Strategic Shopping strategies such as never paying full price for chicken and beef, and only buying the featured half-price sale chicken or beef and stocking the freezer to avoid paying full price in future weeks.  That 30-50% savings clearly combats the expected 3-5% increase in this category.

In real numbers, if a family of four uses six pounds of boneless chicken breasts per week as ours does and they purchase the chicken at the going price each week, their average cost per week would be $18, assuming that one week it’s full price at $4 per lb. and the next week it’s on sale at $2 per pound.  If that same family bought two weeks’ worth of chicken on the sale weeks and stocked the freezer, the weekly cost for the same chicken would go down to $12 at today’s prices.  If we expect chicken prices to go up 4%, the weekly cost of sale-priced chicken would be $12.60. 

This example shows that the projected price increases could actually be a money-saver for families who haven’t been as diligent about Strategic Shopping yet, since their weekly cost would go from $18 to $12.60.  On an annual basis, they’d save $281 on chicken alone.

For the family that has already been using this smart strategy, the projected price increase could be an annual increase of $31 on one item alone.  To save more, Strategic Shoppers can work to reduce their chicken/meat costs by:

--compare prices of frozen versions to the fresh versions.  For example, individually frozen boneless chicken  breasts may be 10% less expensive than fresh when purchased in a larger bag. 
--compare the cost of store brand versions of any item to the name brand version, even when the name brand is on sale.  Look for coupons for any grocery items and be brand flexible if that means you can get a large discount on a new brand for the same type of item.

--compare prices of frozen versions at discount stores like Aldi’s and wholesale clubs like Costco and Sam’s.  You may pay a lower price per pound in exchange for having to buy larger packages, but you can divide the package into smaller packages for the freezer.

--compare prices of different cuts of the same item, such as using whole chickens rather than boneless chicken breasts, or buying a less expensive cut of beef. 

--experiment with new recipes that use a lower amount of the main ingredient such as stir-frys, salads, casseroles and soups.

Stock up now:  To delay the impact of the projected price increase, you can stock up on these main dish ingredients if you have the freezer space.  Be sure to stock up at low sale prices because it doesn’t make sense to stock up at full price.  From now on, you’ll only be buying these items on sale!  You may also consider the freezer life of various cuts and buy the items that last the longest.  For example, whole chickens can be frozen longer than chicken parts, and whole or steaks can be frozen longer than ground beef. 

As a general guideline, you can reference this chart from the USDA’s website: http://www.fsis.usda.gov/FactSheets/Focus_On_Freezing/index.asp#12

Source of drought statistics: http://www.hlntv.com/article/2012/07/26/drought-means-higher-grocery-bills-you