Food: Easier Prices

In many supermarkets, the usually frustrating chore of shopping for food has in recent weeks taken on something of the serendipitous air of an Easter-egg hunt. After years of seemingly nonstop prices, the costs of a growing number of items--eggs, mayonnaise, turkey, tuna, canned fruit--are actually turning down. Though the evidence is still spotty, the long and painful surge in food prices at last appears to be waning.

Last week Pillsbury Co. cut wholesale prices on a broad range of biscuits and other products by 10%. In addition, farm-commodity prices have been dropping for months. Many experts, looking forward to a bumper crop this fall, expect the trend to continue. Since October, corn has slid from $4.03 to $2.84 per bu., wheat from $5.45 to $3.61 and sugar, which was trading at a horrific 64-c- per lb. in November, to 28-c- on commodity markets. Choice beef has been declining. But increasingly tight supplies will probably force it up by 10-c- or 12-c- per lb. at retail levels this spring or summer.

Despite rapidly falling commodity prices, processors and retailers have been reluctant to pare prices until now because of high operating costs. So far, retail price cuts have been scattered and moderate: in Chicago, 5 Ibs. of sugar now goes for $1.99, compared with $2.35 a few weeks ago, but white bread is selling for 60-c- a loaf, up 16% from a year ago. Nonetheless, Clarence Adamy, president of the National Association of Food Chains, claims that "food stores are posting more price declines now than they have at any time in the past three years." Agriculture Secretary Earl Butz estimated last week that food prices generally would "level off or decline" in the second half of the year.

A potential obstacle to further decreases is a bill before Congress that would raise price supports for farmers. Albert Rees, director of the Council on Wage and Price Stability, warned last week that approval of the bill would lead to another surge in food prices: "The consumer is just beginning to get some relief from high food prices, and I don't believe he will take very kindly to this legislation."

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