Labor costs drive up Fourth of July food prices

COLUMBIA, Mo. (KMIZ)

Those planning a Fourth of July cookout this week might notice an increase in their grocery bill compared to last year.

A report by the American Farm Bureau shows the cost of a Fourth of July cookout has increased in 2024 to an average of $71.22 for a party of ten people. This is the first time the cost has reached above $7 per person.

According to the report, the national average cost of a Fourth of July cookout for ten people is:

• 2024: $71.22
• 2023: $67.73
• 2022: $69.68

However, the Midwest average is slightly lower at $68.26 for a party of 10.

Agricultural Economist at the University of Missouri Scott Brown said people will likely be able to notice the increase at the grocery store.

"When you typically look at the hamburger that we're going to grill at the Fourth of July, everything in that is going to be more expensive," Brown said. "Ground beef's probably going to lead the way, but the cheese that you're going to put on it, the bun that you're going to use, all those things have moved higher."

The report states meat is the most expensive item, with ground beef, pork chops and chicken breasts accounting for half of the overall cookout cost.

The cost of pork is up 8% compared to 2023, while ground beef is up 11%. The report states this is due to the smallest cattle inventory in over 70 years.

"The cattle industry right now is still in recovery from that drought phase when a lot of farmers sold off some of their herd to make it through those drought conditions," said Janet Adkison with the Missouri Farm Bureau.

However, Brown said there is a chance the Midwest sees cheaper beef prices than other regions.

"We're closer to cattle production, so, maybe ground beef is a little bit less expensive," Brown said.

Meanwhile, chicken is one of only two food staples that have seen a price decrease, along with potato salad. Both dropped in price 4% compared to 2023.

Lemonade saw the most dramatic price increase this year, up 12% compared to 2023. The report said this is due to a decrease in lemon production and an increase in sugar prices.

Other notable increases are an 8% rise in potato chips, a 7% rise in the cost of hamburger buns and a 7% rise in the cost of ice cream.

Experts say to look for deals and shop around to find the best prices.

While the Farm Bureau reports food price increases are slowing, the overall cost of a cookout has increased by 30% in the past five years.

Brown said the increase is largely due to labor costs.

"We don't see that kind of food inflation in the United States very often," Brown said. "These two years have really seen that expansion in food prices as all the inputs to get a product from the farm all the way to the retail shelf have gone up."

He said prices usually will rise and level out, but not go down. The factor that could potentially cause food prices to decrease is a drop in consumer demand.

"If we were to talk about a deep recession, perhaps consumers back away from some of the demand that we've seen of late for food in particular, that could be one of the things that would actually move us lower," Brown said.

Adkison said farmers are not benefiting from the increase in food costs. In fact, the study states farmers receive fewer than 15 cents of every dollar spent on food.

"Farmers are price takers, they're not price makers," Adkison said. "They don't get to set the prices for the goods that they're selling, most often."

The report states farm incomes have dropped 17% in 2023 and are expected to drop another 25% in 2024.