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Supermarket Prices Still Climbing Amid Coronavirus Pandemic


With America stuck in recession, prices have been falling but not at the supermarket. Grocery stores are doing a brisk business. As NPR's Scott Horsley reports, the way people are filling their shopping carts tells us something about how Americans are adjusting to the pandemic.

SCOTT HORSLEY, BYLINE: Inflation on aisle seven. On Wednesday, the Labor Department reported that overall prices fell last month. But grocery prices were up again. It's been like that since the beginning of the pandemic when supermarkets were just about the only stores that were open. First, Americans stocked up on canned goods. Then we emptied the shelves of eggs and baking flour.

KRISTIN HOFFMAN: Right at the beginning of all of the stay-at-home orders, traffic really just exploded. I mean, I saw four to five times higher traffic than even during peak holiday baking season.

HORSLEY: Kristin Hoffman runs the Baker Bettie website and instructional YouTube channel. Back in March and April, she saw a surge of interest from first-time bakers who were hungry and stuck at home with time on their hands. Since then, traffic has cooled off a bit. Maybe our newfound fascination with sourdough starter has stopped or at least slowed down.

HOFFMAN: Sourdough is definitely a commitment. It's a skill that really takes a lot of practice and dedication. So I have heard a couple of people say that they really don't understand why somebody would want to put so much effort into a loaf of bread.

HORSLEY: The national bake-off was a turnoff for some. The price of flour and eggs came down last month after spiking in April. But other supermarket prices are still climbing for breakfast cereal, ice cream and especially beef. While restaurants have begun to reopen, we're still making most of our breakfasts, lunches and dinners at home. That means shoppers are spending extra time in the long-neglected center aisles of the supermarket and turning to quick and easy packaged foods from companies like Kellogg, Campbell's Soup and Kraft Heinz.

K K DAVEY: One CEO described it this way. He said, look, I could have spent hundreds of millions of dollars and I couldn't have gotten this many new consumers. This is a once-in-a-lifetime opportunity for marketers.

HORSLEY: KK Davey is president of strategic analytics at IRI, a market research firm. His own grocery bills have jumped now that his two college-age kids are living at home. Davey says many shoppers who had shunned processed foods in recent years in favor of fresher or more specialty fare are now going back to the macaroni and cheese and Goldfish crackers they knew as kids.

DAVEY: Comfort foods and well-known iconic brands, they've all kind of got a revival, if you will.

HORSLEY: The question is how long will these new shopping habits last? Although there are more choices now about where to eat than there were a month ago, Davey thinks it'll be a long time before Americans go back to spending the bulk of their food dollar in restaurants the way we did before the pandemic. Kristin Hoffman, aka Baker Bettie, says while some people are eager to ditch their pandemic cookbooks, others have developed new tastes and talents that will last.

HOFFMAN: I've heard a lot of people say that they're very surprised how much joy they're finding in bread baking. So, yeah, I do think that there are a lot of people that have found a new love for it and are going to stick around.

HORSLEY: That means grocery prices may keep rising like a well-loved sourdough, even as much of the rest of the economy falls flat. Scott Horsley, NPR News, Washington. Transcript provided by NPR, Copyright NPR.

Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.