At Southeastern Pennsylvania’s DND Market and Deli, prices are up on almost everything. Owner Shailesh Patel told “CBS Mornings” co-anchor Tony Dokoupil that a gallon of milk at his store costs about a dollar more than compared to last year.
The local market isn’t the only one seeing prices rise. National food prices increased 13.1% in July — the bigger jump in a year since March 1979. The average price of a gallon of milk in the country also increased by almost a dollar since the start of the pandemic.
But Patel says he’s not the one seeing milk dollar profits rising, and instead says it’s eventually trickling down to the wholesaler.
Although Wendell Gehman, a third-generation cow farmer, says he sells the milk for more than before, he notes that it’s to cover the increased costs he now has to feed the cows. He said the food that used to cost him around $3,000 a month is now closer to $4,500 to $5,000, and he also doesn’t make any extra profit despite the increased selling prices.
But Kevin Guldin, co-owner of Oley Valley Feed, said he didn’t have the extra dollar either. He says the increase in feed prices can be attributed to things like rising prices for gas, corn and soybeans, which go into making the feed. He blames supply chain increases on “the global economy.”
“This is a global market in what we do,” Guldin told Dokoupil. “You have no one to complain to.”
Economics reporter Jeanna Smialek of the New York Times agrees.
“I think it’s very difficult to talk about this because inflation is not an individual person’s fault,” Smialek said.
“The government did a lot of stimulus during the pandemic and that helped boost consumer demand, which is part of the inflation story,” he said. “I think we can absolutely say that companies expanded their profit margins during that period. You know, companies saw their costs go up, they increased their prices. They increased their prices more than they necessarily needed to just to cover those costs. However, that’s how capitalism works.”
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