While inflation rates seem to be cooling in the last few months, that doesn't mean they aren't enormously high. Two years ago, white bread was 22% cheaper and butter was 31% cheaper than it is now. According to the United States Department of Agriculture, the cost of food overall jumped by 11.4% between 2021 and 2022 — the highest increase since 1974.
While the expected increase this year is under 10%, it still means a big bite to your budget — and chances are your income hasn't kept up. But even though food companies place the blame on higher prices on inflation impacting their own bottom lines, that isn't exactly true. Someone is making a profit from higher prices, though it may not be who you expect.
@kristininthekitchen Replying to @a_little_bit_of__monica #greenscreen I couldnt even believe some of these! I know why I stopped buying certain items and strated making others at home! Homemade can be cheaper but things like butter and flour have gone up! It seems like packaged prepared foods have the biggest increase! #groceryprices #inflation2023 #2021vs2023 #groceryinflation #grocerysavings #grocerysavingtips #cheapmom #walmartgrocery ♬ Southern Nights - Glen Campbell
Who Is Profiting From Food Inflation?
In short, stockholders and companies.
Many food companies may be whining about inflation, placing blame on supply chains and the war in Ukraine for higher prices, but the truth is that they're scoring record profits (a phenomenon that some call "greedflation"). Meat company Tyson Foods more than doubled profits between 2021 and 2022. General Mills raised prices five times since 2021 but announced net earnings were up 16% for the year.
Retailers are doing well, too. Walmart reported a 7% increase in profits between 2020 and 2021. That has meant that the seven billionaire members of the Walton family increased their wealth by a whopping $8.8 billion between 2020 and 2022, according to Forbes.
Why Are Food Billionaires Getting Richer Now?
It doesn't help that just four agribusiness corporations own 70% of the world's agriculture market, and (if the merger of Kroger and Albertsons succeeds), Kroger-Albertsons and Walmart would control 70% of the grocery market.
By dominating the market, these entities can set prices however they like — and consumers may grumble, but having been told there's a reason for higher prices (see the supply chain/Ukraine war argument, plus pandemic complications), we don't tend to complain as loudly as we probably should. While corporations probably are facing higher prices, they are more than comfortable passing them along to the average consumer — plus some.
What Can We Do to Stop Food Billionaires From Robbing Us Blind?
Demanding stronger antitrust laws (which may also untangle supply chain issues, which tend to get glitchy when only a few companies control goods) may help. Anti-price gouging laws are another way to limit their booming profits, as would be a profits tax on food corporations. Spain already has these laws in place and expects to rake in $6.39 billion from taxing energy companies and banks.
While a popular remedy for curbing inflation has to do with tightening the job market or even spurring layoffs, it seems more likely that the megarich are pointing at us to take the blame as well as endure more suffering at the checkout line.