Money is not going far when it comes to groceries.
Price inflation is not a problem for some students, but for others, the rising price of food is taking a bite out of their wallets.
Because of rising commodity prices, University students can expect a 6.5 percent increase in meal plan prices next fall.
Students who chose the Tiger Plus meal plan this semester will see the price jump from $1368 to $1456 this fall.
“Usually, it’s not quite that high, but with inflation, that’s where we ended up,” said David Heidke, director of LSU Dining. “But we’re not going to be higher priced than what the general public faces off campus.”
Heidke said it is important that University dining continues to be competitive.
Meal plans are traditionally set for the year, but prices are always subject to change.
“We try to hold prices for the students,” Heidke said. “Having a price adjustment is the last resort.”
Heidke said University dining has seen the biggest hits from inflation on bread, cheese, milk and other dairy products.
Retail food prices increased 4 percent in 2007, which was the largest increase in 17 years, according to the Economic Research Service of the U.S. Department of Agriculture.
Food prices are projected to rise an additional 3 to 4 percent in 2008 because of higher commodity prices of corn, eggs, wheat and milk.
A rising interest in ethanol production has raised corn prices from $3.40 a bushel in 2007 to an expected price of $4 by the end of 2008.
“There is a huge increase in demand for corn because people are eating it, and now they’re making gas out of it,” said David Brasington, economics professor. “This not only raises prices for corn directly, but makes soybean farmers grow corn.”
More farms are increasing the amount of land dedicated to growing corn, which was where soybeans were previously grown.
As a result, soybean prices are increasing because of an increase in demand and a decrease in supply.
U.S. exports and the weakening dollar value have contributed to higher prices.
Foods that American consumers could normally buy cheaper are becoming more expensive because of worldwide demand.
Food prices are also affected by the increased energy and transportation costs.
“If fuel prices rise, then there are rising prices for inputs in agriculture, and this gets passed down to consumers,” Brasington said.
Inflation rates will get worse, and consumers will continue to feel the pressures, Brasington said.
“We can all agree that the economy has slowed,” he said. “It’s a pretty tough situation that the government has found itself in.”
Brasington said the government could stop inflation by increasing interest rates. But if they increase interest rates, the economy will suffer.
“If the government continues to do what they’re doing, it will get worse,” Brasington said. “They’re caught between a rock and a hard place.”
Other dining options on campus are also being affected by inflation rates.
Kate Guess, director of corporate public relations at Kahala Corp., the franchise parent of Blimpie, said they have been affected by wheat and meat prices.
“Because we’re a franchise, each Blimpie store sets its own prices,” Guess said. “Like any other business, we’re trying not to send the prices on to consumers because consumers are facing the same challenges as we are.”
University students living off campus face the price hikes at the grocery stores.
Abby Crain, communication disorders freshman, said she spends about $100 a month on groceries but uses her parents’ money.
Crain said she shops mostly at Wal-Mart, but she still chooses national brands over the less expensive Great Value brand.
“It doesn’t really affect me that much because I’m not personally paying for it,” Crain said. “But I do try to pick cheaper things.”
Ashley Proze, marketing senior, said she spends $80 to $100 each month on groceries, but for her, prices are not a problem when it comes to food.
She said she does not bother to look at food prices because she is not affected.
But Sam Simoneaux, mass communication freshman, said she and her roommate are forced to watch what they buy and how much they eat.
“My roommate and I split groceries because it gets so expensive,” Simoneaux said. “We always try to get the knock-off brands because it’s cheaper.”
Simoneaux said they usually spend $90 to $150 every trip to the grocery store.
“I definitely have to save my money to eat,” Simoneaux said. “It’s the opposite. Most people save to go out to eat, and we save to buy groceries.”
—-Contact Leslie Presnall at [email protected].