The hottest topic around the Thanksgiving table this year may be the cost of the food itself.
In recent months, inflation has returned to consumer sentiment. Boosting the pandemic-era economy is what it would cost to feed the gang for this food-heavy holiday.
Consider a benchmark of the cost of Thanksgiving dinner from the Federation of America Farm Bureaus. This year’s typical meal will cost $53.31 – $6.41 in one year, or 13.7%. My trusty spreadsheet tells me that this is the biggest single-year jump in this index since costs rose 16.8% in 1990.
Yes, the highest level of 31 years.
In the spirit of the holidays, remember that these price hikes can be tied to things to be thankful for—an economy that added 800,000 California jobs a year. Also, think of past Turkish days in which there is no “thank you-flash”.
A year ago, those who dared to gather for Thanksgiving amid a coronavirus spike celebrated with a meal that cost 4.1% less than in 2019 – the biggest drop in holiday food prices since 2000.
Don’t forget we’re screwed, in the way of inflation. The tab for turkeys and trimmings fell in four of the last five years.
And that single increase in the federation’s index? Up just a penny in 2019.
on the table
The navigation of the food industry’s awkward economic rebound can be told by your Thanksgiving spread.
Labor shortages – and labor costs – made the products challenging to handle. Finding and paying for delivery was wild. And many raw materials are more expensive due to rebounding consumer demands.
Start with the star of Thanksgiving – the turkey. According to the index, a 16-pound bird is 24% more expensive this year.
It’s not just rising prices, it’s selection. The thin labor pool of farmers meant slow processing. So the birds grew up. If you want to cut costs with a smaller turkey, that option is hard to find.
Consider other Thanksgiving mainstays tracked by the Federation.
Fresh cranberries cost 11% more this year. The farmers had a good harvest but struggled to find transportation amid the paucity of truck drivers. In addition, there is an increasing cost of packaging – especially for metal cans used for baked products.
Yet sweet potatoes are up just 3% and green peas up 5%. And it’s a good bet that the 12% increase in carrot and celery veggie trays is largely about the labor cost to make ready-to-serve crudités.
Then there’s the Pumpkin Pie mix that’s 7% pricier. The culprit was a plant-killing fungus that cut down on the size of the pumpkin crop.
Mother Nature was also a factor with baked goods that suffered from a condition many Californians are familiar with – drought. Dry weather has created a shortage of wheat in growing districts of the Midwestern, essential ingredients a baker has.
So pie balls are 20% more expensive and rolls are 15% more expensive. Surprisingly, the prices of stuffing probably dropped by 19%.
And pricing for dairy products — milk, up to 7%, and whipped cream, only 2% — may be more about marketing. Not many grocers are offering that much discount this year.
Thanks-flation isn’t just about filling up.
The Auto Club expects 7.1 million Californians to holiday for Thanksgiving miles, down 16% from 2020 and just 3% from pre-pandemic 2019.
The drivers on the pump have been hit. According to the Energy Information Agency, California gasoline averaged $4.62 a gallon on November 15—the highest since October 2012’s record-setting $4.71 and up 48% in a year.
A reopening economy got more people driving around the world. Prices of crude oil, the main component of gasoline, doubled in 12 months.
Now, if you are using air transport, you are in luck. The Auto Club expects 800,000 Californians to fly for their vacation, up 82% in a year and just 4% down from 2019.
According to the Consumer Price Index, airfares in October were down 5% from a year earlier, part of a 24% drop in the pandemic era. It’s basic supply and demand: too many planes, not enough passengers – especially business travelers.
However, if a Thanksgiving host’s visit requires a hotel stay, well, watch your wallet!
Room rates have risen 33% statewide in the past year—though, according to Visit California, after falling 26% last year.
Why? Another rebound: California hotels are running 60% full in 2021. Yes, it is down from 81% in 2019, but it is a huge improvement from 40% last year.
Jonathan Lancer is business columnist for Southern California Newsgroup. He can be contacted at [email protected]