The April Consumer Price Index (CPI) soared by10.8 percent from April 2021, the largest rise in four decades.  The cost of both gasoline and diesel fuel are the major drivers in recent months responding to post-COVID demand and the geopolitical fallout from the invasion of Ukraine by the Russian Federation.  Groceries increased by 10.8 percent in April 2022 compared to the corresponding month in 2021 with meat and poultry adding 14.3 percent.

A study by Midan Marketing determined that 54 percent of consumers surveyed do not intend changing their purchases of protein foods. In contrast 32 percent will buy less meat but offset by 13 percent intending to increase their purchases. An analyst for J.P. Morgan Chase noted that demand for beef is linked to average income.  In the event that there is a swing from a tight labor market to layoffs that would be expected in the event of a recession, beef demand will fall sharply.  Chicken will be the natural beneficiary of heightened concern over household budgets.  Workers who have not benefitted from increased wage rates and the elderly on fixed incomes will be most affected by inflation and will be seeking value, especially in their purchases of protein including eggs.

Given the projected supply of petroleum products including crude oil and natural gas, and disruptions in supply, high prices for gasoline and diesel are expected to persist through the third quarter of 2022.  While individual consumers can reduce gasoline use by changing driving habits, truckers and food companies will bear the additional cost of diesel fuel that will inevitably be passed on to consumers.

An interesting side issue from Midan Marketing survey is that one percent of the respondents noted that they did not purchase meat.  This is a far lower figure than frequently cited by promoters of a vegan lifestyle who claim that up to ten percent of consumers avoid red meat and poultry over considerations of welfare and sustainability.