In face of rising food prices, uneasy economy, consumers are changing their buying habits

Steadily rising food costs aren't just causing grocery shoppers to do a double-take at the checkout line -- they're also changing the ways we feed our families.

The worst case of food inflation in nearly 20 years has more Americans giving up restaurant meals to eat at home. We're buying fewer luxury food items, eating more leftovers and buying more store brands instead of name-brand items.

For Peggy and David Valdez of Houston, feeding their family of four means scouring grocer ads for the best prices, taking fewer trips as a way to save gas and simply buying less food, period.

"We do more selecting, looking around, seeing which prices are cheaper," David Valdez said. "We are being more selective. We have got to find the cheapest price."

Record-high energy, corn and wheat prices in the past year have led to sticker shock in the grocery aisles. At $1.32, the average price of a loaf of bread has increased 32 percent since January 2005. In the last year alone, the average price of carton of eggs has increased almost 50 percent.

Ground beef, milk, chicken, apples, tomatoes, lettuce, coffee and orange juice are among the staples that cost more these days, according to the federal Bureau of Labor Statistics.

Overall, food prices rose nearly 5 percent in 2007, according to the U.S. Department of Agriculture. That means a pound of coffee, on average, cost 57 cents more at year's end than in 2006. A 12-ounce can of frozen, concentrated orange juice now averages $2.53 -- a 67-cent increase in just two years.

And a carton of grade A, large eggs will set you back $2.17. That's an increase of nearly $1 since February 2006.

"The economy is having a definite impact on shopper behavior," said Tim Hammonds, president and chief executive officer of the Food Marketing Institute, a retail trade group. "People are significantly changing what they do."

Soaring prices are causing shoppers to rethink long-held habits such as store loyalty.

Wal-Mart and other supercenters that sell food now account for 24 percent of the market, according to the most recent annual survey of shopping habits by Hammonds' organization.

In 2007, the FMI survey showed the average number of weekly shopping trips falling below two per household for the first time.

Paula Curtis, a mental health worker in Montpelier, Vt., said her grocery bill has been steadily climbing by $10 to $20 a week. She has cut back on meat, fruit, vegetables and snack food, and buys milk at the gas station, where she said it's cheaper.

"Every time I go, it's more and more," she said. "I make a list, but I don't necessarily get everything on it because I can't afford everything."

Nationwide, a family of four on a moderate-cost shopping plan now spends an average of $904 each month for groceries, an $80 increase from two years ago, according to the USDA.

Those who can't absorb the added expenses are increasingly seeking help from food pantries. America's Harvest, which distributes nearly two billion pounds of food and grocery products each year to more than 200 food banks across the country, estimates that its overall client load increased by 20 percent in the fourth quarter of 2007.

The jump has been even higher at the Central Missouri Food Bank's pantry in Columbia.

The food pantry served 7,200 people in 2007, an increase of more than 50 percent over two years, said executive director Peggy Kirkpatrick.

Columbia used to be considered inflation-proof because of its high-paying university jobs and proximity to the state capital, 30 miles away in Jefferson City.

"That's not the case anymore," she said.

Among retailers, the surge in commodity prices -- from corn, now in high demand because of increased ethanol production, to wheat that has tripled in price over the past 10 months -- has some industry observers suggesting that higher food prices aren't a temporary fluctuation but instead may be here to stay.

"We don't exactly have a crystal ball," said Whole Foods' Perry Abbenante, a senior global grocery buyer. "But I'm not sure [prices] are going back. We're preparing for a new threshold."