Holding the Line on Prices

Posted on Aug 15, 2022 by Jack McCann

You already know from reading the news or visiting the grocery store: Food is more expensive lately. A lot of this is because the cost of nearly all the stuff that goes into food (transportation, grain and feed, increased prices from suppliers) has also gone up. For Ian and Elizabeth (who raise our laying hens) the cost of feeding those hens has gone up over 40 cents per dozen eggs, just in the last year.

The price TC Farm charges for our food went up less than 1% between May 2021 and May 2022.

The USDA tracks monthly food prices each month and shares price changes month-to-month and year-to-year. You can see that over the last year, in the US the price of meat poultry and fish has gone up over 13%. Eggs have gone up over 32%. Across the board, food at home prices in the US have risen nearly 12%. At TC Farm, because of the way that we operate, we’ve been able to hold the line against those sorts of price increases. The prices we charge for our food from May of 2021 to May 2022 went up less than 1% (0.78%).

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This chart is from the USDA which tracks monthly price changes in food items. The part highlighted in yellow shows the year-to-year change from May 2021 to May 2022.

Inflation has taken a big bite out of grocery store budgets

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During that same period of time, from May 2021 to May 2022, while prices at the grocery were up nearly 12%, prices at TC Farm increased by less than 1%.

How TC Farm is Different

Remember, when you buy from TC Farm, you aren’t just shopping. Why do we ask all those questions about food preferences and recurring items and more? It is because TC Farm isn’t a store. We are group of farmers and consumers directly tied together. We raise our food the best way possible, based on what our members (you!) have told us they (you!) will be ordering. We don’t sell into a wholesale/commodity market. So: when there are shortages or bigger trends stoking price increases, our members are less affected since we have planned ahead. Our pricing was already set up in advance to reflect our members’ consistency in purchasing.

The biggest reason why our prices didn't change as much? We aren't part of the big agriculture wholesale system that grocery stores are buying all their food from. We are outside of a system that bids up prices when scarcity happens. Our farmers are raising food directly for our members. Unlike a grocery store, our members aren't forced to pay the high prices on the spot market. Our farmers aren't increasing prices except to cover their actual cost increases.

Other farmers' profits for meat items are down - or losses bigger - all while the processors and distributors collect expanded profits

Most of the prices increases that have occurred in stores are to add extra profits, not cover increased costs. A small part of that has gone to increased wages but the majority of “inflation” has gone to corporate profits. (In fact - other farmers' profits for meat items are down - or losses bigger - all while the processors and distributors collect expanded profits.)

We work to make sure that everyone in our group - our farmers, our employees, our members - is served well. That means ensuring fair prices for our farmers and making sure they are able to withstand increased costs. That means providing our employees with the fair wages and benefits that they deserve. And that means holding our prices down for our members where we can and not making excessive profits or charging more simply because everyone else is.

We have more control over own operations and relationships with our other growers but there are still some changes that are going to affect us here too. Higher transportation costs. Those higher feed costs that farmers like Ian and Elizabeth are incurring with their hens. Even as we’ve held the line, we will need to adjust some prices as newer harvests come in.

We’ve always been transparent with our members about stuff like this. We've written in the past about processing costs as well as how the food industry is structured in a way that leads to exactly the sorts of problems we're seeing today.

You can be sure that we will continue to be thoughtful and transparent and keep everyone included in the conversation! We always want to hear from each of you, too!

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