Experts are warning that high oil and diesel prices could soon lead to increased costs for groceries and other household staples.
Diesel prices currently average more than $5 per gallon nationwide, a roughly 38% increase from just one month ago.
The surge in fuel costs impacts nearly every stage of the supply chain, from the natural gas used to produce fertilizer to the fuel required for farm equipment and long-haul shipping. While some retailers may initially absorb these higher transportation costs, financial professionals suggest the impact could eventually reach consumers at the checkout counter.
Also impacting prices is the fact that a significant portion of global fertilizer exports travels through the Persian Gulf.
Jeff Ragland, a financial professional, explained that all of these factors contribute to the rising cost of farming.
“It makes production of just raw foods more expensive in general,” Ragland said. He added that because of diesel costs, “it’s more expensive to get to the store.”
Small business owners are feeling the immediate impact of these price surges.
Rafiel Lapuente, owner of Fish Basket Northwest, noted the change in operational costs for his food truck.
“Maybe 5 minutes ago, I go to put my diesel in my truck,” he said. “It’s up (to) $6 per gallon. It’s very, very expensive.”
While fuel prices have spiked, Ragland said most goods currently on store shelves were likely produced and shipped under previous price agreements.
Ragland explained that consumers could notice the change as new harvests arrive.
“As more food start coming from the farms, that’s when you’re really going to start feeling it at the grocery store,” he said.
Some experts suggested that retailers might absorb these higher transport costs for a limited time if the market fluctuations are short-lived.
To save money, LeAnn Dailey, a resident of SeaTac, said she uses coupons and various retail apps to provide for her family.
“We have to feed all the kids,” Dailey said.
She noted that while these methods help, the savings can be offset by the cost of traveling to different stores.
“More on gas, because then you travel further,” Dailey said.
Experts recommend that shoppers consider generic brands over name brands, buy items in bulk if they offer a discount, and use cash-back applications to save money.
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