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Drink up: Price of milk, orange juice plunging

Citizen Staff Writer



Raid the dairy section, stock up on O.J., and favor fowl over the hooved proteins.

Those are three ways to save on your grocery bill based on the latest survey by the Arizona Farm Bureau Federation, which does quarterly assessments of 16 common grocery items.

Orange juice showed the greatest decrease, with the average price down $1.40, to $2.49 for a half-gallon container. Shredded cheddar cheese was down $1.31, to $3.65 a pound; a 5-pound bag of flour dropped 50 cents, to $3.19; and milk was down 20 cents to $2.87 a gallon.

The largest prices increases were deli ham, up 70 cents a pound to $5.28; ground beef, up 30 cents a pound to $3.99; and toasted oat cereal, up 24 cents an 8.9-ounce box to $3.23.

“What’s happened with dairy is we’re oversupplied, and milk prices should be staying low through a good chunk of this year,” said Julie Murphree, spokeswoman for the Gilbert-based Arizona Farm Bureau Federation.

Local shopper Stephanie McKerchie said she has seized on lower milk prices.

“My fiancee and I have three gallons of milk in the fridge, because we drink a lot and use a lot for cereal, and I have noticed that it’s gotten a lot cheaper compared to last year,” said McKerchie, 20.

The substantial drop in milk prices will come at an eventual cost to the consumer, as milk producers will most likely pull back on their production, resulting in an eventual uptick in prices that could come as early as this fall, Murphree said.

“Given the suddenness and severity of the plunge in farm-level milk prices, a significant number of farmers won’t survive much longer with the milk prices they’re receiving,” said Paul Rovey, chairman of the board for United Dairymen of Arizona.

Farm-level prices for milk were down almost 50 percent in February from the beginning of 2008 due to the economic downturn, growth in world supplies of dairy products, and lower international and domestic demand, Rovey said.

McKerchie noted that her savings on milk and cheese is canceled out by rising beef prices.

“I buy steak for dinner, and that’s been really hurting our pocketbook,” she said.

For Norm Peterson, the only reasonable prices he sees on beef these days come in quantities too large for him to buy.

“To get a decent price, you have to basically buy the family pack, which is about a dollar per pound cheaper. But unless you’re going to buy that much, it’s up,” said Peterson, an 86-year-old retired contractor. “Milk prices have definitely come down, but overall, if anything, I think I’m paying more.”

Peterson’s 62-year-old daughter, Carol, said it’s not just higher prices that steer her away from beef.

“Don’t even get me started on beef,” she said. “I don’t know where the heck all the good meat is, but they must be shipping it out of the country, because all we get is the weird stuff.”

Most of the savings that warehouse worker Mark Lopez sees when shopping come with a caveat, he said.

“When the prices are really good on milk and other stuff, it’s usually because of the expiration date, because it’s about to go bad,” said Lopez, 40. “Most of the other stuff I buy, like cereal, vegetables and meat, that’s all gone up.”

The bureau compares prices on a quarterly basis for the Marketbasket survey, but comparing the first three months of 2009 to the last quarter of 2008 has been complicated due to a change in six of the items used in the survey, Murphree said.

The Farm Bureau looked at the institute’s data on shopping trends over the last two years and based on that data, updated the 16 Marketbasket items to better reflect consumers’ current buying habits, said Jim Sartwelle, an American Farm Bureau economist.

Based on the former 16 items used in previous quarters, the first quarter of 2009 was down 32 cents from the previous quarter, Murphree said. That’s the second consecutive drop, as the last quarter of 2008 was down $2.71 from the third quarter of 2008.

Arizona’s total price on the Marketbasket was $7.02 higher than the U.S. average of $47.41 for the same 16 items.

The state’s food prices are generally less favorable than the national average because there are a lot of basic foods that are brought into Arizona rather than produced and processed here, Murphree said.

“If you’re in the Midwest, you’ve got the whole integrated supply chain working for you, but here, the middleman-handling and transportation costs increase the prices,” Murphree said.

Arizona also has a lot of rural areas served by single grocery stores, which aren’t under the same pressure to lower prices as those in urban areas with more competition, she said.

The bureau seeks to identify the best in-store prices, excluding promotional coupons and special deals, so shoppers can often find better prices than those listed in the Marketbasket survey if they seek out in-store specials, Murphree said.

The bureau advises shoppers wishing to stretch their dollars to focus on basic food items over processed ones, and when possible, modify their eating habits, Murphree said.

“With that box of corn flakes, the actual corn in the box is not more than 5 to 8 cents, but the box costs you $3.50, so you’re paying for the middleman,” she said. “It might not be as convenient, but instead of cereal every morning, if you have eggs one morning and fruit and milk on another morning, that will make a difference. Eggs are about 16 cents a piece.”


Item AZ change over U.S.

average pvs. quarter average

Red Delicious Apples, lb. $1.46 down $.01 $1.35

Russet Potatoes, 5 lbs. $3.69 no change $3.05

Ground Chuck, lb. $3.99 up $.30 $2.94

Sirloin tip roast, lb. $4.99 up $.14 $3.99

Sliced deli ham, lb. $5.38 up $.79 $4.94

Bacon, lb. $3.88 up $.19 $3.26

Boneless chicken breast, lb. $4.75 down $.04 $3.38

Whole milk, gallon $2.87 down $.20 $3.15

Shredded mild cheddar cheese, lb. $3.65 down $1.31 $4.24

Eggs, dozen, large $1.99 up $.20 $1.50

All-purpose flour, 5 lbs. $3.19 down $.50 $2.51

Orange Juice, half gallon $2.49 down $1.40 $3.00

Vegetable oil, 32 oz. $4.29 down $.03 $2.79

American Salad mix, lb. $2.99 up $.10 $2.63

Toasted oat cereal, 8.9-oz. box $3.23 up $.24 $2.91

White bread, 20-oz. loaf $1.59 no change $1.77

Source: Arizona Farm Bureau Federation Marketbasket Survey

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