Iowa farmers are still struggling with low commodities prices, but Iowa consumers may’ve noticed some grocery prices are actually coming down. U-S-D-A economist Annemarie Kuhns says the agency’s prediction last year that food prices would rise two-to-three percent this year was wrong, as prices have stayed steady or fallen slightly — which is very unusual.

Kuhns says, “Even after the recession of 2007 and 2009, we still saw food prices increase slightly albeit low rates, but we really haven’t seen deflation since the 1960s.” The U-S-D-A report says consumers are paying lower prices for beef, pork, poultry, eggs, milk and other dairy products, while the prices Iowa farmers are getting for their products are predicted to drop. Corn is down 11-percent, for example.

“A lot of the costs that make up what we pay at the grocery store include things like food processing, transportation, retail overhead,” Kuhns says. “There’s just so many factors of production that go into the price that we’re actually paying, sometimes these changes at the farm level have a muted effect.” If prices go up overall this year, she predicts they’ll only top one-half of one-percent. The early forecast for 2017 shows grocery prices will rise one to two-percent.

(Radio Iowa)