SATURDAY: Mostly cloudy. High: 36. Winds: Light South.SATURDAY NIGHT: Mostly cloudy. Low: 32. Winds: South 5-10 mph.SUNDAY: Mostly cloudy and mild. High: 43. Winds: South 10-15 mph.Joe CrainStorm ...more »
Food Costs Rise, Gas Prices Fall
It is a basic principle of economics: when demand is up and supply is down, prices rise.
“People are just--they've started to feel a little more comfortable about the economy so they're eating a little more meat," Cimeron Frost of the Illinois Beef Association said.
After the drought destroyed feed and forced producers to scale back, there is not a lot of meat to go around.
“We've lost a significant number of cows in this country," Frost said. "We're probably at the lowest they've been since the 1950's."
Analysts have talked about the "trickle-down effect” this will have for months, but microbrewery and eatery Obed and Issac's said they have yet to feel it.
“I will do my best to keep those prices down,” general manager Casey Conn said.
That's a hard thing to do when the cost of everything seems to be going up.
“From not only meat to cheeses, everything all the way down to even the grains that we use for beer,” Conn said.
Analysts say taxes and healthcare costs are rising too. But there may be one saving grace: the price at the pump.
“Everything is hauled on the back of a truck at some point in time, so I'm sure it will affect prices," Frost said.
The U.S. Department of Energy says the average cost for a gallon of gas will fall 5 percent this year to $3.44. That would still be the third-highest price ever, but it is also 19 cents lower than last year's average.
Analysts also say that will save the average household more than $200 a year, which translates to $25 billion Americans can spend on things like eating out.
AP contributed to this report.