Drought, Gas Prices Drive Produce Prices Up

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Knoxville (WVLT) - If fresh fruits and vegetables are on your dinner table, you already know what the drought and the pain at the pumps are doing to your grocery budget.

Volunteer TV’s Gordon Boyd takes a look at who's cutting and chewing some of the numbers.

From farm to market, the grocery business often depends on single digit margins. So a major bump in any link of the food chain, rattles all the way to the checkout line.

Clarice Trotter's found her favorites at Sutherland Avenue's Farm Fresh Market. But this season, “I used to live on a farm, and we had corn at a certain time and evidently that's not, they haven't grown the way they should to produce at the time that we expected it to.”

Drought's trimmed the green beans too.

Blame the freeze, for the Georgia peaches.

And when you factor in fuel, “It has affected price, quality, availability, it's affected everything really,” says Martha Watkins from Neel’s Produce.

This season, Neel's Produce figures its raised wholesale prices ten percent for its more than 250 restaurant customers in the Tennessee Valley.

In Martha Watkins more than half-century in fruit and vegetables, “we just cannot remember the day that we've ever had to do that.”

The Consumer Price Index puts food costs up four percent from this time last year. With drought and ethanol demand pushing corn to four bucks a bushel, food price inflation is its highest in 15 years!

Competition puts the the big supermarkets, in their own, and in some cases, different basket.

Industry analysts say if Wal-Mart keeps produce prices steady or higher, the others will follow.

Martha Watkins says Neel's long, strong history with suppliers hasn't forced her to compromise quality. “So far, we have not increased or added a fuel surcharge to our orders, but I think nearly everybody else has.”

So will she, if the trend continues?

The Farm Fresh Market has no fear of losing Clarice Trotters business.

“We just get what we can find,” she says. “I just spend more time looking.”

The supply, and quality issues could keep fruit and vegetable prices up, the rest of the year.

Assuming better weather next year, prices could ease, but you've still got to get that produce from field to market.

And if gas and diesel prices remain high, well do the math.

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