Holiday shoppers can expect less-expensive turkeys and moderate price increases on other Thanksgiving staples this holiday season. In the U.S., average annual food price inflation is about 2.5 percent, but this year, food prices are running just 1 percent higher than 2012 prices.
"There's a lot of good news out there for the consumer. Food price inflation is very low this year," says Corinne Alexander, associate professor at Purdue’s Department of Agricultural Economics and grain-marketing specialist.
For the items most commonly associated with Thanksgiving meals, Alexander says some prices will be up a bit and others will be down slightly.
"We're expecting the overall Thanksgiving meal to be roughly the same price as last year, and potentially depending on what sort of in-store specials are being offered, you might even spend less this year than you did last year on Thanksgiving," she says.
Turkey, the main item on many Thanksgiving dinner menus, should cost consumers less this year. The USDA predicts that wholesale prices for eastern-market whole turkeys will be between $1 and $1.06 per pound in the fourth quarter, compared with $1.06 per pound in 2012.
It's important for consumers to remember that the way wholesale prices translate to retail prices depends on individual retailers, Alexander says. The actual price paid also will vary depending on whether a shopper chooses a whole turkey or turkey parts; frozen or fresh birds; fresh, precooked or complete turkey meals; brand names; and the value of store coupons and price specials. Often grocers will offer turkeys at a deep discount to encourage shoppers to purchase their other Thanksgiving products.
"Because turkey is a favorite loss leader, that's one of those items where savvy shoppers can look to coupons and store specials to really find the best price possible for their Thanksgiving turkey, and then the rest of the items for their Thanksgiving meal," she says.
Prices for other Thanksgiving staples will be a bit of a mixed bag. Cranberry prices are expected to be on par with last year—an abundant crop should keep prices from increasing, while strong demand will keep them from decreasing. Sweet potatoes are expected to cost consumers about 10 percent more than they did in 2012. White-potato prices also are up by about 15 percent this year compared with the record low prices last year.
On average, Americans spend about 10 percent of their incomes for food. Alexander says that the below-average price increases this year could mean there's room in the family budget to add treats to the holiday meal, though increasing energy costs will also be an economic factor. Consumers will pay more for energy when preparing their Thanksgiving feast than they did in 2012. Natural gas prices have increased by about 5 percent and electricity prices by about 3 percent since last fall. However, those traveling for a holiday meal will get some relief at the pump. Gasoline prices are down about 8 percent compared to last year.