A customer walks by a display of fresh eggs at a grocery store on Sept. 25 in San Anselmo, California. Grocery prices rose 0.4% in November, according to the Consumer Price Index, leading to tougher times for many during the holiday season. (Photo by Justin Sullivan/Getty Images)

A rise in food prices makes for a less than merry holiday season.

Grocery prices rose 0.4% in November, according to the Consumer Price Index, released this week by the U.S. Bureau of Labor Statistics.

Eggs made one of the biggest jumps at 8.2% over the month, and 37.5% over the past year, providing challenges for people trying to eat a somewhat cheaper protein and families cooking holiday foods such as sugar cookies and jelly doughnuts.

Although the increase in food prices has moderated a bit from past years, they are still more than 20% higher than they were before the pandemic, according to David Ortega, at Michigan State University.

“It was a key issue in the election in terms of people really feeling that sticker shock at the grocery store,” said Ortega, a food economist.

President-elect Donald Trump vowed to bring down prices during his campaign and blamed the Biden administration for how they reached this point. But in an interview with TIME published this week, Trump said he does not believe his presidency would be a failure if grocery prices do not come down.

“It’s hard to bring things down once they’re up,” he said.

Price changes to understand before you set the holiday table

The increase in grocery, or food at home prices, was partly driven by the rise in egg and beef prices, Ortega said. He said the price of holiday roast has been affected by drought and high feed prices. This year, the inventory of beef cattle was the smallest beef herd since 1951.

“On eggs, the story continues to be bird flu together with increased consumer demand given the holiday season,” he said following Wednesday’s release of the latest Consumer Price Index. “And for beef the issue is supply — high input costs and decisions that beef producers made a couple of years back when they were facing drought and high feed prices which has reduced beef supply, and this in turn is affecting beef prices.”

The latest food price numbers presented a mixed bag for holiday shoppers looking to bake treats this month. Flour and prepared four mixes fell 1% and bread decreased 1.3%, while sugar and sweets rose 0.2%, and butter ticked up 1.5%.

Oranges, including the popular stocking stuffers tangerines, fell 1.8% in the latest Consumer Price Index report.

The rise in cost of eating your meals at home compared to the rise in cost of eating out is also getting narrower, with the gap in inflation between restaurant menu prices and grocery year-over-year prices being the narrowest it has been since May 2023, according to Supermarket News. Food at home in previous reports rose 0.2% and 0.4% compared to 0.2% and 0.3% for the past two food away from home reports.

Are companies profiting off of uncertain times?

Rakeen Mabud, chief economist at the Groundwork Collective, a left-of-center economic think tank, said that just a few seed producers, meatpackers, and grocers dominate the food industry, which is a key part of the story of what drives grocery prices. This hurts lower-income shoppers the hardest. Oklahoma, Iowa, and Arkansas are some of the states most dominated by a single grocer, such as Walmart or Hy-Vee.

“Across the food and grocery industry, we have a sector that is deeply consolidated,” Mabud said.  … And so when you have big companies controlling such large chunks of the market, we know that they have used things like inflation, things like supply chain shocks to jack up prices far beyond what their input costs to justify.”

Mabud said that when there is this level of market concentration, companies can signal to each other in earnings calls that they are going to start raising prices.

“If you know that your only other competitors are also raising prices, there’s kind of no reason for you to try to undercut them if you both hold giant shares of a market,” she said.

An economic paper published this year found that companies are able to coordinate price increases around cost shocks and increase profits from these events. Mabud said the holidays provide plenty of opportunity for the food industry to raise prices on things people ordinarily don’t buy and don’t have a price comparison for during a less in-demand season.

“Grocers and the food industry kind of know that they know that they have more information about the underlying cost of a good than a consumer who only comes to buy the Christmas ham once a year. And so they can take advantage of that,” she said.

An unhappy new year for grocery shoppers

Economists are watching out for how the next administration will impact food prices.

Trump’s promise to impose heavy tariffs on the U.S.’s biggest trading partners – Mexico, Canada and China – are expected to drive up the cost of everything, including groceries.

Products the U.S. can’t produce year round, like fruit and coffee, will be affected, Ortega said.

“There’s still a lot of uncertainty in terms of whether these tariffs are really going to be implemented or are they a negotiating tool? But that creates a lot of uncertainty,” he said. “Even that amount of uncertainty can lead to a rise in costs as companies prepare for the potential of these tariffs taking place.”

Trump’s expected policy of mass deportation of immigrants will also affect the agriculture industry, in addition to the major human rights implications.

“If there’s a mass deportation that is a shock to the labor supply and the agricultural sector. And that will lead to an increase in costs as producers and companies have to offer higher wages to attract enough labor. Ultimately that gets passed down to the consumer in the form of higher prices,” Ortega said.

Mabud is also concerned that expected tariffs could mean companies take advantage of the policy change well beyond the actual financial impact to their business.

“It’s a policy change where consumers don’t necessarily know how much the price of an avocado is going up because of a tariff versus a supply chain issue versus the grocery store just wanting to increase the price,” she said.

Patricia “Pogo” Overmeyer, 65, who works as a lawyer in Arizona and lives with her retired husband, said she has always been focused on how to save money on groceries. But she said she has become even more thrifty since inflation worsened.

She said she’s been using more meatless meals and stocks up on holiday food all year round when prices are low, some of which she freezes and cans.

“Once I retire, our income will not be as high,” she said, “Most likely I will forgo some foods or make substitutions. It’s anyone’s guess as to what we will be paying for groceries.”

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Holstein milking cows at an Idaho dairy on July 20, 2012. (Photo by Kirsten Strough/USDA)

WASHINGTON — The U.S. Department of Agriculture announced Friday it will require dairy farms to share samples of unpasteurized milk when requested, in an effort to gather more information about the spread of highly pathogenic avian influenza.

Public health officials have tracked the spread of bird flu or H5N1 in domestic poultry flocks for years before the virus began showing up in the country’s dairy herds this March, raising concerns.

While the risk to the general public remains low and there is no evidence to suggest bird flu can spread from person to person, nearly 60 people, mostly farmworkers, have contracted the virus this year.

The new milk testing requirements from USDA will apply nationally but will begin first in California, Colorado, Michigan, Mississippi, Oregon and Pennsylvania, the week of Dec. 16. 

“Among many outcomes, this will give farmers and farmworkers better confidence in the safety of their animals and ability to protect themselves, and it will put us on a path to quickly controlling and stopping the virus’ spread nationwide,” Agriculture Secretary Tom Vilsack said in a written statement.

Unpasteurized milk

The U.S. Food and Drug Administration has repeatedly tested pasteurized milk on store shelves throughout the country to reaffirm it’s safe to drink. Other dairy products, like cheese and ice cream, have also been found safe.

But the FDA continues to urge people against consuming unpasteurized milk, since it doesn’t go through the heating process that kills off viruses and bacteria.

Health and Human Services Secretary Xavier Becerra said in a written statement the new milk “testing strategy is a critical part of our ongoing efforts to protect the health and safety of individuals and communities nationwide.”

“Our primary responsibility at HHS is to protect public health and the safety of the food supply, and we continue to work closely with USDA and all stakeholders on continued testing for H5N1 in retail milk and dairy samples from across the country to ensure the safety of the commercial pasteurized milk supply,” Becerra said. “We will continue this work with USDA for as long and as far as necessary.”

The USDA began a voluntary bulk tank testing program for milk this summer in an attempt to make it easier for farmers to move their cattle across state lines without having to test each cow. The department also began a year-long study in August to test for bird flu in dairy cattle moved into meat production, seeking to confirm prior studies that found it safe to eat.

The bird flu outbreak has affected 720 dairy herds throughout 15 states so far this year, though California became the epicenter during the last month, according to data from the USDA.

The Golden State holds nearly all of the 273 herds diagnosed, with just four found in Utah during the last 30 days.

California also holds the bulk of bird flu infections in people, with 32 of the 58 diagnosed cases this year, according to information from the Centers for Disease Control and Prevention.

Colorado accounts for another 10 human cases and Washington state confirmed 11 people infected with H5N1. Michigan has had two cases this year, while Missouri, Oregon and Texas have each had one positive human case.

USDA order

The USDA federal order announced Friday will require anyone responsible for a dairy farm — such as a bulk milk transporter, bulk milk transfer station, or dairy processing facility — to share unpasteurized or raw milk samples when requested.

Any farm owners whose dairy herds test positive for H5N1 will be required to share epidemiological information that would allow public health officials to perform contact tracing and other types of disease surveillance. 

Additionally, private laboratories and state veterinarians must alert USDA to positive samples that were collected as part of this National Milk Testing Strategy.

A carton of chicken eggs. (Photo by Jared Strong/Iowa Capital Dispatch)

A group of Midwest egg suppliers are embroiled in litigation over egg prices, with an Iowa company arguing it shouldn’t be forced to disclose its pricing information.

A central element of the case is whether a fabricated claim of a bird flu outbreak is to blame for one supplier raising its egg prices and canceling orders.

Grand Prairie Foods of South Dakota, which supplies hotels and convenience stores with breakfast sandwiches, is suing Echo Lake Foods, a Wisconsin company that manufactures precooked egg entrees, for breach of contract and unjust enrichment.

At the same time, a third company, Oskaloosa Food Products in Iowa, is attempting to quash a subpoena for company records related to its pricing.

Court records indicate Grand Prairie has purchased egg patties and other products from Echo Lake since at least 2005. In early 2022, Echo Lake’s supplier of raw eggs experienced an outbreak of avian influenza, commonly known as the bird flu, resulting in the destruction of more than 6 million laying hens.

Echo Lake then notified its customers, including Grand Prairie, that existing purchase orders for egg patties and other egg products would have to be revised to reflect increased pricing.

According to Grand Prairie’s lawsuit, Echo Lake Foods then doubled the price of its egg patties, and while the nationwide market price of eggs eventually decreased, Echo Lake allegedly refused to reduce the price of its egg patties.

Court exhibits show that on July 12, 2022, Grand Prairie’s president, Kurt Loudenback, e-mailed Echo Lake’s director of national sales, Justin Milbradt, writing, “Justin – I don’t understand why we continue to see these high prices,” noting that Grand Prairie could purchase eggs from other suppliers at a significantly lower price. “I’m sure you buy WAY more eggs than we do,” Loudenback added.

The next day, Loudenback emailed Echo Lake again, proposing that his company sell tankers of whole eggs to Echo Lake for $1.28 per pound – significantly less than the $3.60 per pound Echo Lake was charging Grand Prairie for its finished egg products.

“Just trying to get your eggs at (a) lower price to lower my cost,” Loudenback explained in his email. “$3.60 seems pretty high for a $1.28 input cost.”

The two companies eventually agreed on an arrangement whereby Grand Prairie would sell two truckloads of raw eggs each week to Echo Lake. Court records show Echo Lake agreed to pay a “premium price,” $1.70 per pound, for the raw eggs from Grand Prairie. In return, the records show, Echo Lake would sell the finished, processed eggs back to Grand Prairie for $3.60 per pound — the same price Grand Prairie had previously objected to as being out of line with market prices.

Within a few months, however, Grand Prairie told Echo Lake that an avian flu outbreak had affected its egg supplier, Oskaloosa Food Products, and so Grand Prairie would have to raise its prices. A few weeks later, Grand Prairie said it was unable to find a new supplier and wouldn’t be able to fulfill Echo Lake’s orders.

Echo Lake then began acquiring eggs elsewhere – but at a higher price. In court documents, Echo Lake says Grand Prairie’s failure to deliver eggs at the promised price cost Echo Lake more than $1.1 million.

Court exhibits show that in an effort to offset the added expense, Echo Lake withheld payments to Grand Prairie totaling $567,460. Grand Prairie then sued Echo Lake to recover the $567,460 it was owed, alleging breach of contract and unjust enrichment.

Echo Lake countersued, claiming Grand Prairie had breached the contract.

Was company’s bird-flu claim false?

Recently filed court records show that attorneys for Echo Lake are questioning Grand Prairie’s stated rationale for its price hike and the eventual cancellation of orders – an avian flu outbreak that affected the Oskaloosa plant.

In July, an Echo Lake attorney wrote to a lawyer for Oskaloosa Food Products, stating that while “Grand Prairie claims it had no choice other than to cancel the remaining purchase orders because of an outbreak of avian influenza among its suppliers, including Oskaloosa,” an independent investigation had concluded Oskaloosa reported no such outbreak at that time, despite legal requirements for such reporting.

In addition, the lawyer wrote, the chief operating officer of the Oskaloosa plant had confirmed for Echo Lake that “Oskaloosa did not experience the Al outbreak described by Grand Prairie.”

In late May, Echo Lake subpoenaed Oskaloosa Food Products to obtain access to the contract between Grand Prairie and the Oskaloosa company.

Oskaloosa has since filed a motion to quash that subpoena, arguing the agreement includes trade secrets. Echo Lake has responded in court by arguing that the price of eggs is not a trade secret.

That issue is now before a judge in the U.S. District Court for Southern Iowa, while the underlying lawsuit between Grand Prairie and Echo Lake continues to move forward in South Dakota federal court.

Iowa Capital Dispatch is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Iowa Capital Dispatch maintains editorial independence. Contact Editor Kathie Obradovich for questions: info@iowacapitaldispatch.com. Follow Iowa Capital Dispatch on Facebook and X.

A case of bird flu in a Missouri resident is the only diagnosis in the United States this year where the person did not have contact with infected dairy cattle or poultry. (Photo by Stephen Ausmus/Animal Research Services, USDA)

WASHINGTON — The Centers for Disease Control and Prevention should have results later this month that provide more insight into how a Missouri resident, who hadn’t had any contact with infected animals or food, contracted a case of highly pathogenic avian influenza.

Demetre Daskalakis, director of the National Center for Immunization and Respiratory Diseases at the CDC, said on a call with reporters Friday the agency is working through its investigation of that bird flu case, while providing several more details.

“As we previously reported, CDC would be able to perform partial sequencing of the avian influenza H5 virus from the case in Missouri, despite a nearly undetectable level of viral RNA in the patient sample,” Daskalakis said.

That process is complex and time-consuming, in part because the patient had rather small amounts of the virus in their system when the test was taken.

Another contributing factor, he said, is “that the virus has two potentially important mutations, meaning two amino acid differences, in comparison with the viruses previously characterized during this event that could affect antigenicity.”

Daskalakis explained that antigenicity is when someone is able to produce “a specific immune response, such as creation of specific antibodies.”

Both the mutations and small sample size have presented challenges for the CDC, but the agency expects to announce results of the test later this month after completing the complicated lab process, he said.

Two cases in California

The Missouri case is the only bird flu diagnosis in the United States this year where the person hadn’t had direct contact with infected poultry or dairy cattle.

The remainder of the 16 people diagnosed with H5N1 during this calendar year had direct contact with farm animals, with nine of those cases linked to poultry and six related to dairy cows.

One of those cases was diagnosed in Texas, two in Michigan, two in California just this week and 10 in Colorado.

Public health officials on the call emphasized that the risk to the general public remains low and that several studies undertaken by the Food and Drug Administration show pasteurized dairy products as well as other foods remain safe to eat.

Since February, the CDC has tested more than 50,000 samples that would have “detected Influenza A, H5 or other novel influenza viruses,” Daskalakis said.

The Missouri case was the first case of bird flu detected through that influenza surveillance system, he said.

Public health officials at the state and federal level have been trying to determine how the Missouri patient, who officials are not identifying for their privacy, contracted the virus through a series of “intense interviews,” Daskalakis said.

That is how they learned someone living in the same house had been symptomatic with various gastrointestinal issues at the same time the patient had been ill.

That simultaneous onset of symptoms implied “a common exposure, rather than human-to-human transmission,” Daskalakis said, before reinforcing that the second person never tested positive for the virus and isn’t considered a case of bird flu.

“At the time of the interview, the household contact had also completely recovered and had not been tested for influenza while they were sick,” he said. “To be clear, there is only one case of H5N1 influenza detected in Missouri.”

Because the person living in the same house as the Missouri patient had been symptom-free for more than 10 days when they were interviewed by public health officials, Daskalakis said there was “no utility in testing the contact for acute influenza.”

Instead, officials in Missouri took blood samples from the two people so the CDC could test for “antibodies against H5 to assess for possible infection with this virus,” he said.

A separate investigation was taken at the hospital where the Missouri patient had been diagnosed to see if any health care workers had contracted H5N1.

Out of 118 health care workers who interacted with the patient in some way, 18 had higher-risk interactions before the patient was diagnosed and began using what Daskalakis referred to as “droplet precautions.”

Six of those health care workers later developed respiratory symptoms, though only one of them had symptoms by the time the public health investigation had begun retroactively, he said.

That one person’s PCR test for acute influenza came back negative and the other five health care workers, who had recovered, did not require a PCR test, he said.

“Since exposures could only be assessed retrospectively, Missouri has also obtained blood specimens from these individuals for antibody or serology testing at CDC to search for any evidence to support the unlikely possibility that their symptoms were related to H5 infection resulting from their interaction with the patient,” Daskalakis said. “Despite the low risk, this testing is important to complete the public health investigation of this case.”

The CDC began working on that serology testing in mid-September when it received the samples from Missouri, though the complicated process likely won’t conclude until later in October.

“For serology testing to be conclusive, it needs to be done using a virus that is genetically identical to the one obtained from the human case from Missouri or there is a risk of a false negative test,” Daskalakis said. “Since this H5 virus was not recoverable, we could not grow it because there was not enough for the Missouri specimen.”

The CDC, he explained, has to “create the right virus for the test using reverse genetics to match the one from Missouri, so that we can use it in these serology tests.”

“We realize people, including all of us at CDC, are anxious to see results from this testing,” he said. “CDC is moving at a very accelerated pace while conducting rigorous science to assure the validity of these results.”

Poultry, dairy cases

In addition to human cases, bird flu continues to infect poultry flocks and dairy herds within the United States.

While the poultry industry has had years of experience supplying its workers with personal protective equipment and culling affected farms, the dairy industry has had to figure out how to address the virus this year.

Eric Deeble, deputy under secretary for marketing and regulatory programs at USDA, said on the call Friday that Colorado’s mandatory testing program of bulk milk tanks, which began in July, offered a hopeful case study for ridding farms throughout the country of H5N1.

“Initially, this revealed a significant local prevalence, about 72% of dairies, centered in Weld County,” Deeble said.

But following months of hard work by farmers and public health officials, Colorado has just one dairy herd that’s currently affected by H5N1 out of 86 dairy herds within the state, he said.

“Mandatory surveillance in the state allows for continuous monitoring of herds and helps detect any instances of non-negative results early on, ensuring timely intervention,” Deeble said. “This decrease in Colorado cases, even in the absence of a vaccine, gives us further confidence that H5N1 can be eliminated in the national herd, even in places where we have seen an initial rapid increase in cases.”

Data from the USDA show that during the past month, three dairy herds in Idaho and 53 in California have tested positive for H5N1.

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