What gets more expensive – KESQ
By Ramishah Maruf, CNN Business
Inflation and supply chain issues have sent prices for everyday items skyrocketing, from Tide laundry detergent to new cars. Here’s what CNN Business found more expensive this week, and what might be following.
A combination of a supply shortage and strong demand sent orange prices soaring. Frozen orange juice futures prices rose 50% during the pandemic, hitting a two-year high on Thursday. Citrus disease and bad weather hamper orange crops in the United States and around the world. And then there is simply bad timing, because the demand for orange juice has fallen in recent years, but has experienced a spike during the pandemic — U.S. sales of 100% single-strength juice grew from $5 billion in 2019 to $5.5 billion in 2020 and remained mostly at that level through 2021.
Florida had such a small harvest last year – just 44.5 million boxes of oranges – its lowest harvest since the 1944-45 season. In 2019-20, on the other hand, he collected 73.2 million boxes. Brazil also faced a historic drought that reduced its harvest by 31% compared to its 2019-2020 season.
“You have your classic supply and demand mismatch,” said Shawn Hackett, president of Hackett Financial Advisors, which specializes in agricultural commodity analysis. As a result, consumers should expect “much higher prices at the supermarket”.
The median home sale price was $346,900 in 2021, up 16.9% from 2020. This is the biggest increase registered since 1999, according to the National Association of Realtors.
The housing market frenzy has been a boon for the typical homeowner, who has amassed $50,200 in real estate wealth, looking at median price increases from 2020 to 2021.
“It’s a massive wealth gain for homeowners across the country,” said Lawrence Yun, NAR’s chief economist. “The housing market has had a spectacular performance over the past year with rising sales and rising prices. But stocks are at rock bottom. »
The inventory of unsold existing homes fell to a record low of 910,000 at the end of December, down 18% from November.
Proctor & Gamble announced this week that it will raise prices by around 8% on average for retail customers next month for its Tide and Gain laundry detergents, Downy fabric softener and Bounce dryer sheets.
The company attributed the price increase to cost pressures, including transportation, labor and the raw materials it uses to make its products. The US producer price index, an indicator of prices paid by manufacturers, rose 9.7% last year.
Prices at the pump are on the rise again. Crude oil climbed above $81 for the first time in two months, and gasoline prices are slowly recovering.
“It’s a terrible situation. Gas prices are in this political danger zone,” Helima Croft, head of global commodities strategy at RBC Capital Markets, told CNN.
Since Monday, the national average for a gallon of regular gasoline rose a penny to $3.32 on Thursday, according to AAA. On Friday, it averaged $3.326.
Iowa, Minnesota, North Dakota and Oklahoma saw the largest increases, of 5 cents and more. Prices in Washington DC have also jumped 5 cents since last Thursday..
Edmunds, a car-buying website, said the average price of a new car was $46,426 in December 2021, up 14% compared to the previous year. A shortage of computer chips has limited the production of new vehicles, leading to too low inventories to answer the question.
Record Prices Could Fall, But They Won’t Reach pre-pandemic levels.
While stocks are expected to rebound, experts say there should be less price pressure.
JD Power predicts that the average wholesale price of used cars will fall by around 9% between the fourth quarter of 2021 and the fourth quarter of this year, and that prices should continue to fall in 2023. But there is little likely to reach pre-pandemic levels.
Used car prices also rose nearly 40% in December 2021 from a year earlier, according to new analysis from the Anderson Economic Group.
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Danielle Wiener-Bronner of CNN Business, Anna Bahney, Nathaniel Meyersohn, Matt Egan, Vanessa Yurkevich and Chris Isidore contributed to this report.