Retail Prices of Food, 1949

Transcription

1 Retail Prices of Food, 1949 Bulletin No UNITED STATES DEPARTMENT OF LABOR Maurice J. Tobin, Secretary BUREAU OF LABOR STATISTICS Ewan Clague, Commissioner

2

3 Retail Prices o f Food, 1949 Bulletin No UNITED STATES DEPARTMENT OF LABOR Maurice J. Tobin, Secretary BUREAU OF LABOR STATISTICS Ewan Clague, Com m issioner Digitized for FRASER For sale by the Superintendent of Documents, U. S. Government Printing Office Washington 25, D. C. - Price 15 cents

4 Letter of Transmittal U nited States D epartment of Labor, B ureau of Labor Statistics, Washington, D. C., September 15, The Secretary of Labor: I have the honor to transmit herewith a report on retail prices and indexes of retail prices of foods for the year In 1949, retail food prices were almost 4 percent below those for 1948, and second only to 1948 in being the all-time high. After a sharp drop in February 1949, prices fluctuated moderately from month to month around a downward trend that continued through December. A mimeographed report on retail prices of food, giving index numbers by group and subgroup of commodities and average prices for individual foods in each of 56 cities will continue to be issued monthly and will be available on request as heretofore. This report was prepared by Frances H. Martin of the Food Section of the Bureau's Branch of Consumers' Prices. Hon. M aurice J. T obin, Secretary oj Labor. E wan Clague, Commissioner.

5 Contents Summary 1 Food prices during Changes in food prices by city 3 Trend of prices for major food groups 3 Retail prices and indexes of individual foods in TABLES 1. Indexes of retail prices of food in large cities combined, by year, , and by month, January 1947 to December Indexes of retail prices of food, by city and by month, Indexes of retail prices of food in large cities combined, by commodity group, by year, , and by month Average retail prices of principal foods in large cities combined, by month, Indexes of retail prices of principal foods in large cities combined, by month, Annual average retail prices of principal foods, by city, APPENDIX Brief description of Retail Food Price Index 17 Store sample selection 17 Collection of prices 17 Processing 18 Relative importance 18 Revisions 18 Publications 19 Page APPEN DIX TABLES Table A. Population weights used in computing retail food prices and indexes for 56 cities combined 20 Table B. List of foods and relative importance of individual foods and groups of foods included in the Retail Food Price Index, in the base period ( ), December 1948, and December HI

6

7 Retail Prices of Food, 1949 Summary At the beginning of 1949, unemployment was rising, and there was uncertainty about the chances of a price recession similar to that of February Markets were becoming buyers' markets as more plentiful supplies of durable goods began to fill the pent-up demand created by World War II. In satisfying this demand, more money was spent on durable goods and less on food. High food prices and efforts by consumers to save more of their incomes further contributed to a decline in the demand for food and tended to bring prices down. Buying by retailers and wholesalers became more cautious and inventories were lowered. In the first 2 months of 1949 retail food prices continued the decline from the all-time peak reached in August Through the remainder of the year, food prices fluctuated within a limited range compared with the record peak and subsequent declines during By December 1949, retail food prices averaged 3.8 percent lower than in December Table 1 and chart 1 present the trend in retail prices of all foods combined, from 1913 through Food Prices During 1949 During January and February 1949, food prices continued the downward trend begun in 1948, with declines in prices of meats, eggs, and fats and oils being the major contributing factors. Declines would have been much greater had it not been for the counteracting effect of higher fresh fruit and vegetable prices. Higher prices for these items followed the cold-weather damage in Florida, Texas, California, and Arizona. A 2^-percent drop for all foods from mid- January to mid-february was slightly larger than during the period of the commodity market break of February As in 1948, retail prices were affected by drops in prices of wheat and corn, as well as by the large marketings of cattle and hogs. This resulted in larger than usual declines in the prices of meats. In March and April, prices again rose moderately at the rate of about 1 percent a month. The trend in meat prices was reversed and prices rose more than seasonally during the 2 months in spite of the lower Lenten demand. Fresh fruits and vegetables continued to rise, although less than seasonally. Egg prices were also higher, contrary to the usual seasonal movement as the Lenten season brought greater demand and egg shipments were hindered by weather conditions. In May, prices decreased slightly on the average, as lower prices for most food groups were not offset by higher prices for eggs, fresh fruits and vegetables, lamb, beef, and veal. Pork prices dropped contraseasonally following a break in hog prices when marketings were larger than expected. In June, prices of meats and eggs were up much more than seasonally. Sugar prices increased slightly. Coffee prices, which had shown small increases in January and February, decreased slightly in March, April, and May. They then started the advance that gained momentum as the year progressed. In July, the index for all foods again went down, with prices slightly more than 1 percent lower. All food groups were lower except eggs, dairy products, beverages, and dried fruits and vegetables. With minor exceptions, the food-trend patterns for August and September were similar, amounting to fractional over-all increases. Prices increased for these 2 months for practically all groups except fresh and canned fruits and vegetables. In August, lard prices rose about 8 percent, and margarine 3K percent. During the last quarter of the year, the trend in food prices was predominantly down. There were, however, a few exceptions to this trend. In October, all food groups declined except dairy products, coffee, and sugar. In November, sugar continued to increase slightly, Beef and veal 1

8 RETAIL PRICES OF FOOD, 1949 T able 1. Indexes of retail prices of food in large cities combined, by year, > and>by month, January 1947 to December 1949 [ ] Year Allfoods index Year Allfoods index Year Allfoods index Year and month Allfoods index Year and month Allfoods index Year and month Allfoods index B Y Y E A R B Y M O N T H January January January g February February February March March March 201. April April April i May May May June June June 204. i July July July August August August 202. ( September September September October October October ( November November November 200A December December December : Chart 1. Retail Prices of Food in Large Cities Combined INDEX * 100 INDEX

9 RETAIL PRICES OF FOOD, 19^9 3 prices advanced fractionally. Cereals and bakery products also showed slight increases, as the Texas hurricane damaged the rice crop. Prices of fresh fruits and vegetables in November took a sizable contraseasonal jump and coffee prices soared 24 percent. These price rises counteracted general declines for all other groups so that no appreciable change was shown on the average. In December, coffee prices alone continued the upward trend, increasing an additional 10 percent to establish a record high at retail for this commodity for the fourth consecutive month. All other groups declined to bring the average down 1.7 percent over the month. Prices were affected by a number of factors, among which were increasing price resistance, foreign currency devaluation, strikes, large numbers of hogs marketed from a spring pig crop about 15 percent greater than in 1948, price supports, weather conditions, and general world affairs. Changes in Food Prices by City The price decline over the year was general for the 56 cities surveyed by the Bureau. In direct contrast to the 1948 pattern, prices for 1949 averaged lower in all cities, ranging from 2.5 percent lower in San Francisco to 6.5 percent in Cleveland. After average declines in 38 cities in January 1949, and all 56 cities in February 1949, the downward swing started in August 1948 was halted. From March through September, the trend was upward except for a reversal in July. However, from October through December a downward trend occurred. A comparison of December 1948 with December 1949 shows that prices decreased in all cities, ranging from 0.7 percent in New Haven to 8.2 percent in Los Angeles. Indexes of average retail food prices by city during 1949 are presented in table 2. (Annual average prices of individual foods by city are shown in table 6.) Trend of Prices for Major Food Groups Trends among major food groups varied from December 1948 to December Prices declined for five major groups: fats and oils (25.9 percent); eggs (18.1 percent); meats, poultry, and fish (7.5 percent); dairy products (6.5 percent); and cereals and bakery products (0.6 percent). Prices rose for three groups: beverages (40.8 percent); fruits and vegetables (3.1 percent); and sugar and sweets (3.4 percent). In December 1949, prices had risen most above the level for beverages (192.5 percent), and meats, poultry, and fish (123.2 percent). On the other hand, prices of fats and oils had declined to a point only 36.7 percent above the level. Table 3 presents indexes of retail food prices by group for the years 1923 through 1949 and for each month in The accompanying chart shows the trend of retail food prices by group through Cereals and bakery products. Retail prices for cereals and bakery products remained relatively stable on the average for the second year near the record of January Prices had risen steadily from 1946 through January 1948, after which they leveled off, showing fractional declines over the last 2 years. The largest price changes over the year for items in this group were declines of 13 percent for rice, 8K percent for corn meal, and 6 percent for rolled oats. Meats, poultry, and fish. Prices of the meats, poultry, and fish group decreased 7% percent over the year, with chickens down 13 K percent, fish 9 percent, and meats percent. All meat items decreased. Pork prices dropped 13K percent as salt pork prices dropped 20 percent, bacon 18 percent, whole ham 13 percent, and pork chops 10% percent. Beef and veal averaged 4 percent lower with largest decreases for hamburger (9 percent), chuck roast (8 percent), and rib roast (nearly 4K percent). Leg of lamb declined 1 percent. At the beginning of the year, the number of cattle on feed in the United States was the largest on record. The number of hogs was 4 percent greater than the year before and the largest since January 1, In January and February, prices for the meats, poultry, and fish group moved down more than seasonally. By March and April, meat prices had reversed their downward trend of the previous 6 months to advance more than seasonally. This trend extended through June except for pork, which weakened contraseasonally in M ay with large

10 4 RETAIL PRICES OF FOOD, 1W9 Chart 2. Retail Prices for Groups of Food in Large Cities Combined. 300 f Cereals and Bakery Products = I I I I l l «i i i i i UNITED STATES DEPARTMENT OF LABOR BUREAU OF LABOR STATISTICS

11 RETAIL PRICES OF FOOD, marketings as farmers feared a change in marketing policy. Helping to push prices up during this period were good consumer demand, curtailed shipments brought about by good weather during the corn planting season and the increasingly higher hog-corn ratio, and small supplies of lamb. During the Lenten season, demand increased for chickens and ham. After Lent there was more demand for beef. Beef and veal rose 1 percent in May and percent in June. Scarce lamb, after larger than seasonal increases in March (5% percent) and April (12V2 percent), continued upward in May and June. In June 1949, leg-of-lamb was selling at an all-time high of over 80 cents a pound. Pork prices, which weakened in May (2% percent) contraseasonally, rose 6 percent in June. By July, prices of all subgroups declined, with lamb taking the largest drop (4% percent). Lamb prices continued their greater than seasonal decline through August (over 6K percent), when other meats started to rise again. Prices were fluctuating with amounts of receipts, as growers attempted to maintain prices by withholding animals when markets weakened. In August, prices of chickens and fish which (except for the short Lenten demand) had been declining almost steadily since February, rose along with other items in the group. By September, the rise was general. However, hog growers realized that support prices would decline gradually throughout the rest of the year and attempted to market their hogs as early as possible without breaking the market. In October, the decline set in and continued through the remainder of the year. This drop remained about seasonal as strong demand helped to counteract the effects of unusually large marketings. The December 1949 index for meats, poultry, and fish was ( =100), the lowest level since February In December, meat prices reached the lowest level since February 1949, fish prices were the lowest since October 1947, and chickens the lowest since April Dairy products. Prices of dairy products moved to a level 6% percent lower in December 1949 than in December All items in the group showed declines from the record highs of Prices, which were already high, declined much more than the usual seasonal amounts to a level near that of July Prices of fresh grocery milk declined 8 percent and delivered milk declined 7 percent over the year. In January, February, and March, declines were mainly through Northeastern and North Central areas. By April, the decreases were quite general. In May, decreases were predominantly in the North Central area. From then on, price changes were mixed, with the trend chiefly upward through October, then slightly downward the last 2 months of the year. Prices in the Mountain area remained stable throughout the year. Per capita consumption of milk was somewhat lower in 1949 than in However, with the population larger, the total Assumption remained about the same as the year before. Milk output per cow was kept high throughout the year by unusually good pastures in the most important dairy areas and by heavy feeding of grains and other concentrates in sections affected by drought. There was no direct Federal Government support price on milk for fluid use. The price was established at the producer level through marketing agreements and orders, State-local control boards, etc. Butter prices fluctuated during the year over a narrower range than other items in the group. At the beginning of the year, prices were declining as increasing amounts of milk and cream were diverted from other sources to butter. On February 8, 1949, the United States Department of Agriculture announced a price-support program for butter, designed to yield farmers 90 percent of parity for butterfat for the year as a whole. The program was to be carried out through offers to purchase butter at wholesale when necessary. On February 9, in order to supplement the buttersupport program by stabilizing producer prices for manufacturing milk, the Department of Agriculture also announced resumption of the procurement program for nonfat dried milk, which had been suspended temporarily near the end of Butter prices continued to decline as production passed consumption, and there was confusion over the Government program. Then the Commodity Credit Corporation announced that support prices would be made on a daily basis instead of weekly, an assurance that the Government intended to continue its support program through 1949 as

12 6 RETAIL PRICES OF FOOD, 1949 T able 2. Indexes of retail prices of food, by city 1 and by month, 1949 [ =100] 1949 Region and city Average for the year Jan. 15 Feb. 15 Mar. 15 Apr. 15 May 15 June 15 July 15 Aug. 15 Sept. 15 Oct. 15 Nov. 15 Dec. 15 United States N e w E n g la n d Boston Bridgeport Fall River Manchester New Haven Portland, Maine Providence M i d d l e A t l a n t i c Buffalo Newark k New York 3 * Philadelphia Pittsburgh Rochester Scranton _ E a s t N o r th C e n tr a l Chicago Cincinnati Cleveland Columbus, Ohio Detroit Indianapolis Milwaukee Peoria Springfield, W e s t N o r th C e n tr a l Cedar Rapids Kansas City Minneapolis Omaha St. Louis St. Paul Wichita S o u th A t la n tic Atlanta Baltimore Charleston, S. C Jacksonville Norfolk Richmond Savannah Washington, D. C W inston- Salem E a s t S o u th C e n tr a l Birmingham Jackson Knoxville Louisville Memphis Mobile W est South C en tral Dallas Houston Little Rock New Orleans * M o u n t a i n Butte Denver Salt Lake City P a c if ic L o s Angeles Portland, Oreg San Francisco Seattle Aggregate costs of foods in each city, weighted to represent total purchases by families of wage earners and lower-salaried workers, have been combined for the United States with the use of population weights. 2Estimated index based on half the usual sample of reports. Remaining reports lost in the mails. Index for Dec. 15, reflects the correct level of food prices for New Haven. 2June 1940=100. 4Estimated index based on half the usual sample of reports. Remaining reports lost in the mails. Index for Feb. 15, reflects the correct level of food prices for New Orleans, 3Revised,

13 RETAIL PRICES OF FOOD, announced. By May, retail butter prices dropped more than 6 percent from the December 1948 level. Storage stocks on May 1 amounted to 15 million pounds compared with 4 million pounds the year before. Creameries were selling below price-support levels because of the opportunity for quicker returns and the difficulty of accumulating carlots of uniform grading and packaging necessary in order to participate in the price-support program. During May, the Department of Agriculture purchased approximately a million pounds of butter, bringing the season total to approximately 2% million pounds. There was not much change in retail butter prices during June and July. However, in the latter part of July, announcements were made of a support price for cheese and an unexpected 3-cent increase in the support price for butter. Butter prices then reversed their trend of the first half of the year and rose from August through December. Total purchases in 1949 were 15 million pounds. Retail prices of cheese, which had been declining contraseasonally, continued to decline through May At the beginning of the year, cheese was suffering from the largest increase in production of the manufactured dairy products, and competition with lower meat prices. In July, wholesale prices declined to the lowest point since June 1946, and on July 28 a cent-per-pound support price was announced. Retail prices then rose through October and remained stable through December, in contrast to the contraseasonal T able 3. I?idexes of retail prices of food, in large cities combined,l by commodity group, by year, 1928 to 1949, and by month January 1949 to December 1949 [ =1001 Year and month All foods Cereals and bakery products Meats poultry and fish Total Meats Fruits and vegetables Chickens Fish Dairy Beef products Eggs and Pork Lamb Total Fresh Canned veal Dried Beverages Fats and oils Sugar and sweets BY YEAR, 1923 TO J ,9 BY PRICE REPORTING PERIOD, 1949 Jan Feb Mar Apr May June July Aug Sept Oct Nov. 15._ Dec Comparable indexes for the years have been computed by con- verting indexes from the base to the base, 1Aggregate costs in each city weighted to represent total purchases of families of wage earners and lower salaried workers have been combined with the use of population weights.

14 8 RETAIL PRIORS OF FOOD, 1949 T able 4. Average retail prices of principal foods in large cities combined, by month, 19J Article Average for Jan. 15 Feb. 15 Mar. 15 Apr. 15 May 15 June 15 July 15 Aug. 15 Sept. 15 Oct. 15 Nov. 15 Dec. 15 the year Cereals and bakery products: Cereals: Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Flour, wheat 5 pounds Corn flakes 11 ounces Corn meal pound Rice do Rolled oats ounces Bakery products: Bread, white pound Vanilla cookies...do Meats, poultry, and fish: Meats: Beef: Round steak.....d o Rib roast do Chuck roast... do Hamburger do Veal: Cutlets......do Pork: Ham, whole do Salt pork...d o Lamb: Chops.. do Bacon, sliced do Leg d o... Poultry: Roasting chickens do Frying chickens:4 (3) (0 (3) (3) (3) (3) (3) (3) (3) (3) New York dressed 8 do (0 0) 0) Dressed and drawn * do ) 0) ( Fish: i Salmon, pink ounce can Dairy products: Butter pound Cheese: No. 1 mild Cheddar... do (8) (8) («) (8) (8) (8) (8) Processed American _......do (9) (9) (9) (9) (9) (9) (9) Milk: Fresh (delivered) quart Fresh (grocery) do Evaporated 14^-ounce can Eggs: Fresh dozen Fruits and vegetables: Fresh fruits: Apples.....pound Bananas do Oranges, size dozen Fresh vegetables: Beans, green Cabbage pound do Carrots... bunch Lettuce head Onions pound Potatoes pounds._ Spinach pound.. (10) ) ) 0) ) (10) (10) S weetpotatoes... do (2) (2) Tomatoes d o Canned fruits: Peaches..N o. can Pineapple... do Canned vegetables: Corn No. 2 can Peas do Tomatoes do Dried fruits: Prunes pound Dried vegetables: Navy beans do Beverages: Coflee... do Fats and oils: Lard... * Hydrogenated shortening...do Salad dressing pint Margarine......pound Sugar and sweets: Sugar - do Cost of fresh and/or frozen fish are included in the index, but average prices are not computed. 2 Inadequate reports. 3Not priced after March. 4 First priced in April. 3 Average for 29 cities. «Average for 27 cities. 7Average for 9 months. 8Not priced after June. 8 First priced in July. Not priced after September. 11First priced in October. Average for 10 months.

15 RETAIL PRICES OF FOOD, decline of the year before. Forty million pounds of cheese were purchased during the year under the price-support program. Eggs. Egg prices declined 18.1 percent over the year to the lowest level since April 1947 and the lowest December price since In January, prices declined 3% percent, and in February more than 14 percent, as production increased and meat prices declined. Storage stocks remained small. In March, prices began a rise which lasted through September. In the latter part of February, supplies were held up by transportation difficulties. By mid-march, supplies increased, making increased support buying necessary. Sizable buying for hatcheries, higher meat prices, and Lenten demand also helped to keep prices up. By the end of March 1949, the Government had bought as many dried eggs as during the year of Instead of expected price declines, prices rose with increased demand as meat prices advanced and egg production started to decline in April. It was necessary to draw on storage supplies. The 1949 price peak for eggs was reached in September, 2 months earlier than usual. By October, prices started to decline as record high production and consumer resistance had their effect. Price declines were larger in November as production continued to increase markedly because of the increase in the number of layers on farms. Another weakening factor was the expected decline in the support price after January 1. During the November holiday season, buying increased but then slumped, making it necessary for the Government to purchase larger amounts of dried eggs. Fruits and vegetables. Retail prices of the combined fruit and vegetable groups increased 3.1 percent over the year. Prices of fresh fruits and vegetables rose 6.0 percent, more than offsetting decreases of 9.0 percent for canned fruits and vegetables and 2.4 percent for dried fruits and vegetables. Prices for fresh fruits and vegetables rose during the first 5 months of 1949 and then declined throughout the remainder of the year with the exception of November. Record highs were reached during the year for apples (May), bananas (June), and lettuce (September). In May 1949, white potatoes reached the highest level since April 1926, and sweetpotatoes, the highest level since July In October 1949, orange prices were the highest reported since October In December 1949, prices were higher than in December 1948 for green beans (42 percent), onions (41 percent), cabbage (15 percent), carrots (over 12 percent), and bananas (IK percent). Prices were lower for apples (27K percent), lettuce (over 7 percent), white potatoes (6 percent), oranges (4% percent), and sweetpotatoes (1 percent). Prices of fresh fruits and vegetables rose much more than seasonally in January (8.7 percent) and February (5.4 percent) as the result of frost and drought damage. In January, prices of all items in the group rose except bananas and onions. In February, onion prices remained unchanged, whereas banana prices started to rise, and oranges, green beans, and carrots declined. In March, April, and May, price increases were smaller on the average. March increases were minimized by decreases for green beans, carrots, and onions; April by decreases for bananas, oranges, cabbage, carrots, and spinach; and May by decreases for green beans, spinach, and lettuce. In June, prices decreased contraseasonally, starting the decline which lasted through October as supplies became more plentiful. Prices for most items increased in November, with green bean prices forced upward 44 percent by frost damage. Apple prices, after reaching a record high in May, declined steadily through October with heavy supplies of the new crop. To help stabilize the apple market, plans were made to sell apples for school lunches, and to pay export subsidies to encourage overseas buying. Production of apples in 1949 was slightly over 50 percent more than the short crop of In December, prices declined. Prices of canned fruits and vegetables declined 9.0 percent from December 1948 to December 1949, with decreases for all items. Canned tomatoes and peaches dropped 12 percent, corn percent, peas 4 percent, and pineapple 3% percent. The decrease was general throughout the year, with commercial production of fruit about equal to that of 1948, and vegetable production somewhat higher than the year before. Prices of dried fruits and vegetables decreased 2.4 percent over the year. Prices of dried beans dropped 15 per-

16 10 RETAIL PRICES OF FOOD, 19^9 T abll 5. Indexes of retail prices of principal foods in large cities combined, by month, 19/+9 [ =100] 1949 A rticle Average for the year Jan. 15 Feb. 15 M ar. 15 Apr. 15 M ay 15 June 15 July 15 Aug. 15 Sept. 15 Oct. 15 N ov. 15 Dec. 15 Cereals and bak ery products: Cereals: Flour, w h e a t p o u n d s Corn flakes...11 ounces C o r n m e a L.... p o u n d R ice i-... d o R olled oats ou n ces._ Bakery products: Bread, w h ite p o u n d Vanilla cookies... d o M eats, poultry, and fish: M eats: Beef: R ou n d steak d o R ib roast....d o Chuck roast do H am burger 2... d o Veal: C u tlets d o Pork: C h op s....d o B acon, sliced d o H am, w h ole... d o Salt p ork d o L a m b : L eg d o P o u ltry d o Fish: Fish (fresh, frozen) d o l Salmon, pink 16-ounce can D airy products: B u tter..p o u n d C h eese.. d o M ilk : Fresh (d elivered ) q u a rt Fresh (grocery)... d o Evaporated... 14^-ounce can Eggs: Fresh d o z e n Fruits and vegetables: Fresh fruits: A p p les p o u n d Bananas d o Oranges, size 200 dozen._ Fresh vegetables: Beans, green... poun d Cabbage d o Carrots bunch _ L e ttu ce.. head O nions. pound Potatoes 15 pounds Spinach p o u n d.. (3) (3) (3) (3) Sw eetpotatoes d o Tom atoes 4.. d o Canned fruits: (5) (5) (s) (5) (5) (5) ( 5) (5) (6) (») Peaches.N o. c a n P ineapple d o Canned vegetables: C orn N o. 2 can Peas d o T om a toes d o Dried fruits: Prunes Dried vegetables: N avy beans. do Beverages: C oflee d o Fats and oils: L a rd d o Hvdrogenated shortening. do Salad dressin g p in t M argarine... p ou n d Sugar and sweets: Sugar. d o July 1947=100. 2February 1943=100. 3Spinach not priced after September. 4 October 1949= Tomatoes first priced in October.

17 RETAIL PRICES OF FOOD, 19/f9 11 cent as the result of a large carry-over, a record 1949 crop, lowered exports, and adjustment to a new-crop support level based on 80 percent of August 15 parity instead of the former 90 percent. Prunes rose 7 percent because of short supplies of large sizes. Beverages. Prices of coffee averaged 40.8 percent higher in December 1949 than in December During the spring months, coffee rose slightly, then declined. In June, prices started the increase that gained momentum as the year progressed. Fractional price rises occurred during the summer. Although a short crop was forecast and European demand was expanding, these were not taken seriously at first and roasters continued to buy sparingly in spite of small stocks. However, reports persisted that the Brazilian crop might be only half as large as the previous year s. By mid-october, instead of anticipated lower prices, the prices of futures reached new highs. Between mid-october and mid-november retail coffee prices soared over 24 percent. By mid- December another rise of over 10 percent took place as coffee prices reached new highs for the fourth consecutive month. Fats and oils. Prices of fats and oils dropped 26 percent over the year. The decline was general for all items in the group. Price decreases ranged from 15 percent for salad dressing to 37 percent for lard. At the beginning of the year, there were surpluses of fats and oils, and prices were at the lowest level since October In mid-january prices of fats and oils dropped more than 5 percent below the mid-december level. Another drop of 8% percent occurred in mid-february, along with a general price decrease in other items. Although in February the situation was eased somewhat by the termination of most export controls for fats and oils, and exports were running 76 percent higher than in 1948, prices continued downward. This downward trend was influenced by uncertainty over the fate of the margarine tax law and the continued improvement of world supplies of fats and oils. By mid-july, prices of fats and oils had declined 23K percent from the December 28, 1948 level. On July 27, the United States Department of Agriculture announced that the Commodity Credit Corporation would support the 1949 crop of cottonseed at $49.50 a ton compared with the former price of $35. Cottonseed oil prices then rose, followed by soybean oil prices. By mid-august, reversing their rather steady downward trend of the last year, prices of lard increased 8 percent and margarine increased 3 percent. By mid-september, all items in the group were higher. After increases of 2 percent in August and 3 percent in September, prices of fats and oils again declined through the remainder of the year. Contributing to this decline were the large cotton and soybean crops, fear that devaluation of the pound might result in decreasing the present large exports of oils, and increased production of lard because of heavy hog marketing. By December, the price of 17 cents for lard was the lowest since August Hydrogenated shortening at approximately 32 cents, salad dressing at nearly 34 cents, and margarine at 28% cents were the lowest since October Sugar and sweets. Retail sugar prices increased 3.4 percent during the year Labor troubles during the year resulted in wage increases and caused difficulties in transportation of sugar from Hawaii to the United States. Retail Prices and Indexes of Individual Foods in 1949 Average retail prices and indexes of individual foods for large cities combined are presented in tables 4 and 5 for each month in Annual average retail prices of individual foods in each of 56 cities, for 1949, are shown in table 6.

18 12 RETAIL PRICES OF FOOD, 1949 T a b le 6. Annual average retail prices of principal foods, by city, 1949 NEW ENGLAND MIDDLE ATLANTIC Article United States Fall River New Haven Boston Bridgeport Manchester Portland, Maine Buffalo Newark New York Providence Philadelphia Pittsburgh Rochester Cereals and bakery products: Cereals: C ents C ents C ents C ents Cents C ents C ents C ents C ents C ents C ents C ents C ents C ents Flour, wheat 5 pounds, _ Corn flakes 11 ounces,_ Corn meal pound Rice do,, * Rolled oats 20 ounces, Bakery products: Bread, white pound_, Vanilla cookies do ) ) ( ) 0) Meats, poultry, and fish: Meats: Beef: Round steak do Rib roast do,_ Chuck roast do Hamburger do,_ ) Veal: Cutlets......do,,_ ( Pork: Chops do,_ Bacon, sliced do Ham, whole, _do * Salt pork do,_ ) 40.6 ( Lamb: Leg do * Poultry: Roasting chickens do (9 (9 (9 (9 (9 (9 (9 (9 (9 (9 (9 (9 (9 (9 Frying chickens:8 New York dress- do---- M ) ed. 0) « D ressed and do drawn.7 Fish: Salmon, pink, 16-ounce can, ) Dairy products: Butter,...pound Cheese: No. 1 mild Cheddar do (i ) (10) (10) ( 10) ( 10) ( 10) ( 10) ( 10) ( 10) (10) ( 10) (i ) (i ) ( 10) Processed American,do C11) 09 C11) C11) C11) Milk: Fresh (delivered) quart, _ Fresh (.grocery) do Evaporated. 14^-ounce can, Eggs: Fresh dozen Fruits and vegetables: Fresh fruits: Apples, pound. _ s 10.9 Bananas do. _ Oranges, size 200 dozen Fresh vegetables: Beans, green...pound ) 0) ) Cabbage do Carrots bunch Lettuce head Onions pound Potatoes 15 pounds., Spinach pound.. ( 12) (12) ( 12) (12) ( 12) ( 12) (12) ( 12) (12) ( 12) (12) (! 2) 09 (12) S weetpotatoes do ) ' (9 (9 ( ) ) Tomatoes do ( 13) (!3) (! 3) ( 13) ( 13) ( 13) ( 13) (13) ( 13) ( 13) (13) Canned fruits: Peaches No. can, Pineapple,,do ) Canned vegetables: Corn... _._No. 2 can, Peas do Tomatoes...do Dried fruits: Prunes pound Dried vegetables: Navy beans......do Beverages: Coffee do Fats and oils: Lard do Hydrogenated shortening, do Salad dressing pint Margarine pound Sugar and sweets: Sugar do See footnotes at end of table.

19 RETAIL PRICES OF FOOD, T able 6. Annual average retail prices of principal foods, by city, 1949 Continued Article MID DLE AT LAN TIC Con. EAST NORTH CENTRAL WEST NORTH CENTRAL Scranton Chicago Cincinnati Cleveland Columbus Detroit Indianapolis Milwaukee Cedar Rapids Kansas City Peoria Springfield Minneapolis Omaha Cereals and bakery products: Cereals: C en ts C en ts C ents C ents C ents C ents C ents C en ts C ents C ents C en ts C ents C ents C en ts Flour, wheat...5 pounds Cornflakes...11 ounces Corn meal pound Rice do Rolled oats 20 ounces Bakery products: Bread, white... pound Vanilla cookies.....do ( Meats, poultry, and fish: Meats: Beef: Round steak >..do Rib roast do ) Chuck roast do Hamburger.....do Veal: Cutlets do Pork: Chops do Bacon, sliced...do Ham, whole do Salt pork do Lamb: Leg do ) (0 0) (0 Poultry: Roasting chickens... do (4) (4) (4) (4> (0 (4) (4) (4) (4) (4) (4) (4) (4) (4) Frying chickens: New York dressed do M Dressed and drawn i d o * ) 864.6»62.2 Fish: Salmon, pink.. 16-ounce can Dairy products: Butter......pound Cheese: No. 1 mild Cheddar do (10) ( 10) ( 10) (10) ( i ) (10) (10) (10) (10) (! 0) ( 10) ( 10) (!0) ( 10) Processed American...do Milk: Fresh (delivered) quart. _ Fresh (grocery) do Evaporated. 14^-ounce can Eggs: Fresh.dozen Fruits and vegetables: Fresh fruits: Apples pound Bananas do Oranges, size dozen Fresh vegetables: Beans, green....pound (0 (0 ( (0 Cabbage...do , Carrots... bunch. _ Lettuce head Onions pound Potatoes 15 pounds Spinach...pound.. ( 12) ( 12) ( 12) (12) ( 12) (12) (12) (12) ( 12) (12) ( 12) (12) ( 12) ( 12) Sweetpotatoes... do ( 0 0 ) ) ( 0 ( 0 Tomatoes do ( 13) ( 13) ( 13) (!3) (! 3) (13) ( 13) ( 13) (13) ( i3) ( 13) ( 13) (13) ( 13) Canned fruits: Peaches.....No. 2^ can Pineapple....do ( 0 ( Canned vegetables: Corn No. 2 can Peas do Tomatoes. do Dried fruits: Prunes pound.. 0 ) Dried vegetables: Navy beans...do Beverages: Coffee...do Fats and oils: Lard do Hydrogenated shortening-.do Salad dressing... pint_ M argarine... pound Sugar and sweets: Sugar...do , , Spe footnotes at end of table.

20 14 RETAIL PRICES OF FOOD, 1949 T able 6. Annual average retail prices of principal foods, by city, 1949 Continued. WEST NORTH CENTRAL Cont. SOUTH ATLANTIC EAST SOUTH CENTRAL Article St. Louis St. Paul Wichita Atlanta Baltimore Charleston, S. C. Jacksonville Norfolk Richmond Savannah Washington, D. C. Win ston- Salem Birmingham Jackson Cereals and bakery products: Cereals: C ents C ents C ents Cents Cents C ents C ents C ents C ents C ents Cents C ents C ents C ents Flour, wheat 5 pounds Com flakes 11 ounces Com meal pound ( Rice do ) Rolled oats 20 ounces. _ Bakery products: Bread, white pound Vanilla cookies do ) ( Meats, poultry, and fish: Meats: Beef: Round steak do. _ * Rib roast....do ( * Chuck roast do ) Hamburger do Veal: Cutlets.....do C1) * Pork: Chops do Bacon, sliced.....do Ham, whole do Salt pork. _...do Lamb: Leg do ( * * ) Poultry: Roasting chickens----- do 0 ) ( 9 ( 9 ( 9 ( 9 ( 9 0) 0) 0) ( 9 0) ( 9 ( 9 ( 9 Frying chickens:5 New York dressed.do Dressed and drawn 7_do ( * 56.4 *59.2 «59.1 Fish:9 Salmon, pink. 16-ounce can_ Dairy products: Butter pound Cheese: No. 1 mild Cheddar...do (1 0 ) (1 0 ) (1 0 ) (1 0 ) (1 0 ) (1 0 ) (1 0 ) (1 0 ) (1 0 ) (1 0 ) (1 0 ) 0 ) ( i ) (1 0 ) Processed American... do C11) C11) Milk: Fresh (delivered) quart Fresh (grocery) do Evaporated _14^-ounee can Eggs: Fresh dozen Fruits and vegetables: Fresh fruits: Apples...pound * Bananas do * Oranges, size 200 dozen ) Fresh vegetables: Beans, green pound »23.4 ( ( 9 Cabbage do Carrots bunch Lettuce head Onions......pound Potatoes 15 pounds Spinach pound.. (1 2 ) ( 13) ( 12) (! 2) (1 2 ) (12) (1 2 ) (1 2 ) (1 2 ) (1 2 ) (1 2 ) (12) (1 2 ) (1 2 ) S weetpotatoes do s 10.9 ( ( * * Tomatoes do ( 13) ( 13) ( 13) ( 13) 03) ( 13) ( 13) ( 13) ( 13) ( 13) (13) 09 ( 13) ( 13) Canned fruits. Peaches No. can Pineapple......d o ) (9 0) ) *38.4 0) 0) 0) Canned vegetables: Corn...No. 2 can Peas do * 13.8 Tomatoes do Dried fruits: Prunes pound * * *23.3 Dried vegetables: Navy beans...do ) * Beverages: Coflee do Fats and oils: Lard do Hydrogenated shortening.do Salad dressing...pint Margarine...pound Sugar and sweets: Sugar... do See footnotes at end of table.

21 RETAIL PRICES OF FOOD, T able 6. Annual average retail prices of principal foods, by city, 1949 Continued EAST SOUTH CENTRAL Continued WEST SOUTH CENTRAL MOUNTAIN PACIFIC Article Dallas Knoxville Louisville Memphis Mobile Houston Little Rock New Orleans Butte Denver Salt Lake City Los Angeles Portland, Oreg. San Francisco Seattle Cereals and bakery products: Cereals: Cents C ents C ents C ents C ents C ents C ents C ents C ents C ents C ents C ents Cents C ents C ents Flour, wheat..5 lb * Corn flakes-.ll oz * Corn meal..pound * ) 11.4 * 11.6 Rice..do * * Rolled oats._20oz * Bakery products: Bread, white pound * Vanilla cookies do * Meats, poultry, and fish: Meats: Beef: Round steak do * Rib roast do * Chuck roast do * * Hamburger do * Veal: Cutlets.do Pork: Chops do Bacon, sliced * * * * do * Ham, whole do * Salt pork, do 35.9 * * Lamb: Leg...do 0) * *83.9 *84.2 * Poultry: Roasting chickens do Frying chickens:5 New York dressed 5 do * Dressed and drawn 7_do *55.9 *58.7 *60.6 *58.2 *62.2 *59.9 * ) 0 Fish:» Salmon, pink 16-ounce can.. * * *57.7 * 55.1 Dairy products: Butter....pound.. Cheese: * No. 1 mild Cheddar do (10) (10) (10) (10) (10) (10) (10) (10) (10) (10) (10) (10) (10) (10) (10) Processed American...do (0 (0 0 ) (0 (0 (0 (0 (0 (0 (0 (ii) (0 (0 (0 (0 Milk: Fresh, (delivered) quart * Fresh, (grocery) do * Evaporated 14^-ounce can * Eggs: Fresh dozen Fruits and vegetables: Fresh fruits: * Apples pound * * * Bananas do Oranges, size * 16.6 * * dozen * Fresh vegetables: Beans, green pound *19.5 (0 0 0) ) * Cabbage...do * Carrots bunch *9.1 * Lettuce head *14.4 * Onions pound * Potatoes 15 pounds * Spinach pound (12) (12) (!3) (12) (0 (0 (0 (0 (0 (0 (0 (12) (12) (12) (12) Sweetpotatoes do * * ) 0) 0) *13.3 0) * ) 0 Tomatoes do (13) (13) (13) (13) ( 0 ( 0 (0 1 (13) ( 0 (13) ( 0 Gee footnotes at end of table. (0 (13) (18) (0 (13)

22 16 RETAIL PRICES OF FOOD, 1949 T able 6. Annual average retail prices of principal foods, by city, 1949 Continued EAST SOUTH CENTRAL Continued WEST SOUTH CENTRAL MOUNTAIN PACIFIC Article Dallas Knoxville Louisville Memphis Mobile Houston Little Rock New Orleans Butte Denver Salt Lake City Los Angeles Portland, Oreg. San Francisco Seattle Fruits and vegetables Con. Canned fruits: Peaches C ents C ents C ents C ents C ents C ents C ents C ents C ents C ents C ents C en ts C ents C ents C ents No. can Pineapple do 0) 0) 0) ( ) 0) 0) 0) 0) ) (0 0) (0 Canned vegetables: Corn No. 2 can Peas do ) Tomatoes do *4*823.0 Dried fruits: Prunes pound ( ) Dried vegetables: Navy beans,.do C1) Beverages: Coffee do Fats and oils: Lard. do Hydrogenated shortening do ) Salad dressing pint Margarine pound. _ Sugar and sweets: Sugar do Not available; insufficient number of reports secured during year. 3Average based on reports for 10 months. * Average based on reports for 11 months. 4Not priced after March.» First priced in April. * Average for 29 cities. * Average for 27 cities. 8Average for 9 months. 9Costs of fresh and/or frozen fish are included in the index, but average prices are not computed. 10Not priced after June. 11First priced in July. 12Not priced after September. 13First priced in October. 14Price per No. 2}^ can.

23 Appendix Brief Description of Retail Food Price Index The Retail Food Price Index, a component of the Consumers, Price Index, measures average changes in retail prices of a fixed list of foods of constant quantity and quality, bought by moderate-income families in large cities. This is in line with the general purpose of the Consumers Price Index of measuring how much more or less it costs at one time than at another to purchase a fixed list of goods.1 The index is not designed to measure how much more it costs to live in one city than in another.12 Retail food prices were first collected in 1903, when the Bureau s representatives obtained prices for the years 1890 through 1903 from grocers records. At that time, 30 foods were priced in 171 representative cities in 33 States. Since then changes in the lists of foods and in the number of cities have been made, with the number of foods varying between 16 and 87 and the number of cities between 39 and 171. The base period, collection and computation methods, and techniques have also changed from time to time. Currently the Bureau publishes retail prices of 50 foods in 56 cities. Each month about 80,000 quotations are collected from 1,650 independent stores and 150 chain organizations representing 6,500 chain stores, or a total of about 8,150 stores. Store Sample Selection In selecting the sample of stores for food price reports, the Bureau has taken into account type of store in terms of foods handled, size of store as 1A detailed discussion of the Consumers Price Index is presented in the bulletin, Consumers Prices in the United States, (Bull. 966). The index as it was computed through 1941 is described in Changes in Cost of Living in Large Cities in the United States (Bull. 699). 2 A special study of differences in costs between cities is presented in The City Worker s Family Budget in the Monthly Labor Review, February 1948 (also reprinted as Serial No. R. 1909). measured by sales volume, and geographic location within the city. Revisions in store samples are made from time to time, to maintain the accuracy of the Bureau s food price index. The latest complete sample revision took place between September 1945 and June Less comprehensive changes have been made in the store samples since that date. Collection of Prices The Bureau collects retail prices of 50 foods in each of the 56 large cities included in its Retail Food Price Index, during the first 3 days of the week containing the fifteenth of the month. Local Bureau representatives collect retail food prices from grocers who report voluntarily. The representatives are provided with a description (specification) of the quality for which price quotations are desired. Within the range of each specification, they are instructed to secure a price for the type, brand, etc., that is sold in greatest volume in each store. Specifications are defined precisely enough to insure a meaningful average price and avoid movement in the index because of shifts in the quality priced from one period to the next. They are also broad enough, within limitations, to provide an adequate number of quotations and to allow for city and regional differences in grades, types, package sizes, etc. Prices are obtained for items found to be most important in wage earners family budgets as shown by a comprehensive study in The selection of the index items also takes into account similarity of price changes, since it is impossible for the Bureau to collect prices for all of the many foods purchased by families. Price 3 See Store Samples for Retail Food Prices in Monthly Labor Review for January 1947; also reprinted as Serial No. R

24 18 RETAIL PRICES OF FOOD, 1949 movements of foods not included in the monthly surveys are imputed to those of other foods or food groups showing similar price trends, by means of allocation of weights. Processing Each month, the Bureau s field representatives return their pricing schedules to the Washington office, where they are edited carefully for conformance to the required specifications. Conversions to uniform quantity unit are made as necessary, and weighting factors are entered in preparation for machine tabulation. The data are then processed by machine tabulation. The Retail Food Price Index is a fixed-baseweighted-aggregate index. Weighting factors are used to maintain appropriate relationships, (1) among chain stores (outlet weights), (2) between chain and independent stores (chain-independent ratio), (3) among foods in each city (consumption weights), and (4) among cities (population weights). Average prices for each food in each city are computed separately for chain and independent stores. Weighting factors (called outlet weights), based on annual volume sales of retail reporters, are used in calculating average prices for chain stores within each city. A simple average of independent store prices is obtained, since the sample was selected to be a self-weighting sample. Chain and independent average prices for a city are combined by use of chain-independent ratios to obtain average prices for the city. This chainindependent ratio is based on the percentage of total food sales in a city made by chains and by independent stores. Consumption weights (called quantity weighting factors) for each city are applied to the individual food prices to give them their correct proportions in the city s group and all-foods indexes. These weights are based on consumer expenditure data obtained in The resulting weighted aggregates are combined to obtain indexes for the major food groups and for all foods combined. City population weights are employed in obtaining average prices and indexes for 56 cities combined. These weights are based on the population of the metropolitan area containing the city in which prices are collected and that of cities in the same region and size class. Adjustments in these population weights were made in February 1943 in accordance with Census Bureau estimates of changes in population from April 1940 to May 1942, based on the registrations for the sugarration book. Table A shows the population weights now in use. Relative Importance The relative-importance4 of the individual foods in the over-all index is computed and released by the Bureau once each year. These relative-importance figures are percentage distributions of the values of the individual foods in the index as of a certain date. The values are obtained by multiplying the quantity consumption weights by the average prices for the specified date. Thus, the relative-importance figures are not weights in themselves. They change from time to time as prices for the various foods change at different rates, since the consumption weights used in their computation remain constant. Table B presents a tabulation of foods priced, individually and by groups, and relative importance (percentage) of each in the all-foods index for 56 large cities combined, for the base period ( ), December 1948 and December Revisions In order to maintain the accuracy of the index, special tests and surveys from which revisions may develop, are made from time to time. Some of the more important recent revisions are described below. Adjustments to wartime and then to postwar conditions were made in March 1943 and February In March 1943,5 quantity weights of 27 foods were reduced in line with anticipated 1943 supplies available to consumers under rationing regulations, and weights of 26 less scarce commodities were increased. At the * <See Consumers Price Index: Relative Importance of Components, in the Monthly Labor Review for August 1948; also reprinted as Serial No. R * See Bureau of Labor Statistics Cost-of-Living Index in Wartime, in the Monthly Labor Review for July 1943; also reprinted as Serial No. R

25 RETAIL PRICES OF FOOD, same time 7 foods were added to the index. The chain-independent store ratio was revised on the basis of latest available estimates of changes in volume of food sold through chains and independent stores. Five cities were added to the index, increasing the total number from 51 to 56. The population weights were changed to take into account the marked shifts in population during wartime. In February 1946, the Retail Food Price Index was again revised to eliminate the special wartime adjustments. Prewar consumption weights were restored, with minor adjustments, to retain the 7 items added to the index in 1943, and outlet weights within cities were changed, using the latest sales volume data available. The computation of average prices for chain and independent stores, separately, was initiated at this time. Formerly the ratio between the two types of stores was used in computing city averages but the computation procedure did not maintain the fixed ratio when the number of quotations varied from period to period. The revised procedure was an improvement in that the stability of the averages would be affected less by short supplies, since the chain-indepen dent ratio would remain fixed, even though some reporters were unable to furnish price quotations every collection date because of food shortages. During this revision some changes in editing were also introduced. The sample of stores was considered large enough that minor changes in the sample of stores or shifts from one brand to another within specification did not require adjustment for comparability in computing indexes. Index numbers for individual items which were begun at this time are used in obtaining percentage changes, rather than prices, since major differences in the sample and in specifications are still taken care of in the index by linking. After February 1946, sales taxes were no longer included in the published average prices, but were incorporated in the index for each city. Average prices in cities having sales taxes were reduced by the amount of tax formerly included. See Store Samples for Retail Food Prices, in the Monthly Labor Review for January 1947; also reprinted as Serial No. R The last major revision took place in August 1947,7 when the list of foods included in the index was reduced from 62 to 50, a new subgroup for meats (excluding poultry and fish) was added, and the number of quotations from independent stores for dry groceries and staples was reduced. This reduction did not materially affect the accuracy of the average prices because of the small amount of price variation from store to store for these foods. As procedures change and revisions are made, indexes are linked (made equal in a given month) so that changes arising from the mechanics of revisions do not alter the level of the index and it continues to reflect price movements only. In 1949, the Bureau of Labor Statistics began a 3-year revision of its Consumers Price Index. Under this program, the entire structure of the Retail Food Price Index will be subject to review. Expenditure surveys will be conducted to secure information for use in bringing the market basket of foods up to date. From these surveys, the Bureau expects to determine what kinds of foods are consumed currently and in what amounts. Special price studies have also been planned to determine the adequacy of the city coverage and of the store samples, as well as how many foods must be priced regularly to measure changes accurately. As in the past, it will be impossible to include in the index prices of all foods purchased by families. Prices of more than 100 foods will be collected experimentally beginning early in 1950 in order to determine the similarities and differences in price movements among foods. Publications Retail food price data are issued regularly as follows : 1. Consumers Price Index and Retail Food Prices (monthly mimeographed). 2. Retail Food Prices by cities (monthly mimeographed). 3. Retail Food Prices by Cities Annual Averages (annually mimeographed). 4. Monthly Labor Review (monthly). 5. Retail Prices of Food (annually). 7See Revision of Retail Food Price Index in August 1947, in the Monthly- Labor Review for October 1948; also reprinted as Serial No. R