All along food distribution chain, rising prices felt

MONTPELIER, Vt.—Whether making bread for a living or merely shopping for it at the supermarket, Vermonters are feeling the brunt of sharply rising prices for grains and other food products.

"I shop around. I look for deals," said Pat Lesure, a state employee who was shopping at the Price Chopper in Berlin on Friday. "But it's a struggle now. It really is."

Food prices were up 4 percent in 2007 the largest jump in nearly two decades, according to the U.S. Bureau of Labor Statistics, after rising 2.4 percent in both 2005 and 2006.

The bureau reports that the price of bread is up 30 percent since February 2006. The national average price for a dozen eggs is up 84 cents, to $2.17. Orange juice is up to an average of $2.53 for 12 ounces of frozen concentrate, from less than $1.90 two years ago.

Price increases are being felt at the wholesale level as well.

Paul Manghi, owner of Manghi's Bread in Montpelier, said he had been forced to raise his wholesale prices by 11 percent because of the rising cost for ingredients.

"Things like sunflower oil and spelt flour have gone up in the range of 50 percent," he said. "And wheat flour has gone up more than 200 percent."

"We just make what we make, and any cost increase we experience we just have to pass on to the customer," Manghi added. "We don't know yet how people will react to this, but so far we haven't seen any negative impacts."

Another 4 percent jump in food prices is forecast for this year, said Ephraim Leibtag, an economist with the Economic Research Division of the U.S. Department of Agriculture.

"This is the largest increase in recent memory," he said. "Since the 1990s food prices and inflation have been so stable, and thats why this increase is getting so much attention now."

At Norwich-based King Arthur Flour, spokeswoman Allison Furbish said increased exports, higher fuel costs and farmers converting wheat fields to corn for ethanol production are combining to send wheat prices spiraling upward.

King Arthur has posted a notice prominently on its Web site describing the situation. "People are going to notice price increases, and we feel its important for them to understand why," Furbish said.

A 5-pound bag of flour that cost $2.89 a year ago will be up to $4.99 by April, she said.

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Information from: The Times Argus, http://www.timesargus.com/