Economy

Peanut butter prices going up

Peanut butter is disappearing from some food bank shelves, particularly in the Midwest, as peanut butter manufacturers raise their wholesale prices by 20 percent to 40 percent.

But Northwest grocers say that while shelf prices are drifting upward, don’t expect the lunchbox staple to disappear from local store shelves anytime soon.

John Boyle, senior vice president of sales and marketing for Metropolitan Markets, said peanut butter is still available in quantity, though prices are increasing somewhat to reflect a smaller crop this year.

Sara Osborne, spokeswoman for Safeway in the Northwest, said that while supplies are tighter, there’s still plenty of peanut butter to go around. Peanut farmers say a combination of factors this year has put spot prices for peanuts in the stratosphere.

Peanut prices spiked to over $1,200 per 1,000 pounds (up from $465 in 2010) for runner peanuts, the kind used to make peanut butter, in mid-November. But the Georgia Peanut Commission says that price doesn’t reflect the true cost of peanuts to food manufacturers. Most peanut farmers contracted to sell their peanuts last spring before planting at a far lower price.

“A low supply of peanuts left from last year’s crop, poor market prices at planting and drought conditions throughout this year’s growing season have converged at one time to create a perfect storm that is driving up the price of peanuts,” said the commission. “The tight peanut supply and the rules of supply and demand, not farmers, are responsible for higher prices consumers may experience.”

Read the complete story at thenewstribune.com

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