World Food Price Index

About two weeks ago I had a cold, so I went to the grocery store to buy some orange juice. Tropicana is my favorite brand, so I looked and looked but couldn't find the regular Tropicana container with the big orange on the side with a straw punched into it.

It took me a few minutes, but I found Tropicana's new OJ box that looked so generic that even when I got it home, I thought it was a cheaper, generic brand made by the grocery store chain I went to. It wasn't. It was Tropicana, and I wondered why the company would change its logo. What better way to show freshness than an orange with a straw poking out?

Apparently I wasn't the only person wondering what had happened to the old packaging, or why the company would change its logo.

It's a relief to be watching the rain clouds pass over Northern California, where I live, for the next few days. Unfortunately, say weather experts, we may not get enough rain this winter to fend off the worst drought in 20 years. That's bad news for the rest of you, too. California farmers, who grow the majority of America's fruits and vegetables, are leaving thousands of acres bare, for fear they won't be able to water their crops later. That means you'll probably be paying more for your produce this year, starting this spring.

When I used to work at the campus bookstore back in college, I always wondered why the little blue books that every student had to buy for finals were at the back of the store. Since everyone needed at least a few, why not put them up near the front of the store so they could quickly grab them and buy them?

Boy, was I naive. The answer, my manager told me, was the same reason why grocery stores put milk and other staples at the back of the store: To get customers to walk through the length of the store to get the basics, and hopefully pick up an impulse buy on their way back up to the cash register.

So instead of just returning from the Spartan Bookstore with just a blue book that cost a quarter and maybe a 10-cent pencil, the students walked out with a book, shirt or soda that they hadn't planned on buying when they arrived, I learned.

The same goes for grocery stores, and knowing where to shop while once inside can help you save a lot of money. For example, as Jennifer Openshaw reports in her MarketWatch column, the outside aisles are where the unprocessed staples are -- meat, eggs, milk and produce -- while the expensive packaged foods are on the inside aisles. I like to shop fast and get in and out of a store with what I want, so wandering the aisles doesn't help accomplish that.

I was shocked this summer when I saw the price of maple syrup virtually double in a few weeks' time. My family sweetens a lot of our food with maple syrup as we are working to reduce overly processed foods in our diet. At the time, I didn't know exactly why, but I've just been schooled in the world of maple syrup prices, and I've drawn some hypothesis about forecasting food pricing in general as a result.

Maple syrup is (unsurprisingly) dominated by Canadian production. What was a surprise to me was that Canada's government holds oversupply from a prior year and (much like the U.S. government's oil reserves) dumps it onto the market the next year if it is required. Due to a few years of low production due to weather, the Canadian government depleted its last bit of reserves sometime during 2007, and the price went sharply higher.

However, in the U.S., pricing isn't agreed upon in the way in which most commodities are; small suppliers negotiate one-on-one with small customers, in most cases. What's more, American production has steadily increased so that, in 2008, the U.S. was able to produce about 34% of Canadian production, giving the small suppliers an ever-larger impact on the world's prices.

The economic prediction of the owner of Tillinghast Maple: prices are about to start dropping as of the 2009 maple crop, if weather holds. The U.S. has more power and the reserve depletion of last year will have evened out. And I wonder if this model, of small farmers negotiating with small customers (kind of a farmer's market model, hmmm?) will have ever-greater impact on the U.S. market as customers more and more choose to buy local, shop in co-ops and farmer's markets, and buy produce and meat from CSAs and other direct relationships. Could little guys save the food economy? It's worth hoping.

Wondering how we got our prices? We contacted a group of friends and colleagues around the world to report on prices in their local supermarket. Where we couldn't find responsive acquaintances, we shopped online. We converted to pounds and quarts from metric units (except for some items, such as Coca-Cola, already in liters, or a dozen eggs or a loaf of bread, for instance). Then we translated from local currency to U.S. dollars, using the current price as of July 29, 2008.

In order to get our baskets to be even (lemons to lemons, if you will), in cases where our shoppers were unable to find prices for an item we filled in the average worldwide price to obtain the "index" price. This is the list we gave our shoppers:

• half-gallon whole milk
• 1 lb ground beef
  
• 12 oz box of Cheerios or local brand-name equivalent
• gallon of regular gas
• 1 lb dry pasta
• 1 lb bananas
  
• 1 lb baking potatoes
• 1 lb coffee beans
• 1 lb white rice
  
• loaf of white bread
  
• dozen eggs
• 2 liter Coca-Cola or other soda
  
• liter of maple syrup
  
• pound price for whole chicken
  
• 1 head of leaf lettuce
  
• 1 pint seasonal fruit, preferably farmer's market
  
• 1 lb tofu
  
• 1 lemon
  
• 1 bunch basil
  
• 1 (3 oz) organic chocolate bar
  

Below you'll find notes and explanations from some of our food surveyors worldwide.

Johannesburg, South Africa -- $75.16
Pick n' Pay

In Johannesburg, despite its proximity to many of the world's finest coffee-growing regions in Northern Africa, coffee is among the most expensive in the world, around $14.30 a pound.

London, England -- $79.08
Waitrose

In London, coffee is by far the most expensive; $18.26 a pound. On the other hand, maple syrup is a relatively inexpensive $6.56 per liter, and white bread was only $0.74 for a loaf.

Adelaide, Australia -- $74.82
Coles

Our shopper, Jessica, reported that maple syrup isn't sold in litres in Australia, but grams. She was also wowed by paying close attention to individual prices and discovering that, for instance, white rice is comparably cheap in Australia (67 cents a pound) whereas basil ($3.12 a bunch) and white bread ($4.22 a loaf) are among the most expensive in the world.

Little Rock, Arkansas -- $42.69

Alisha, who shops for her husband and baby, reported that she doesn't drink milk but expects to be adding that to her baby's diet soon; so she was interested to see that her basket of groceries was so inexpensive. She said she wasn't able to find organic chocolate at her local supermarket. Her price for a dozen eggs -- $1.00! -- is testament to the fact that Arkansas is the chicken capital of the U.S.

Newmarket, Ontario, Canada -- $67.61

Canadians have pricey groceries in comparison to many places in the U.S., but they save money on coffee -- it's only $5.99 per pound compared to a $7.11 worldwide average. Amazingly, maple syrup was more expensive in Ontario than it is in Los Angeles, where the grocery stores are much farther away from maple syrup country.

Bangalore, India -- $31.93

Our Bangalore basket turned out to be the cheapest of all, although according to Moupiya, neither dry pasta or maple syrup are readily available in India. For a couple of products, Piya quoted prices for both high quality and low quality groceries, and the difference was pretty astounding; coffee was 42 cents a pound for the cheap stuff and $1.05 per pound for better coffee (still the cheapest in the world, mind you). White rice was 11 cents for low quality and 25 cents for high quality.

Los Angeles, California -- $77.74
Ralph's

In the city of angels, eating is a pricey affair. Ground beef registered at $5.29 a pound -- the highest price in the U.S. and one of the highest worldwide. Bananas, at $1.60 a pound, were positively European in cost. A dozen eggs? $5.99. But Coca-Cola is a bargain: $1.00 for two liters.

Portland, Oregon -- $63.85
Safeway

I shopped at Safeway, though I'm a committed "locavore" and typically get most of my produce from the farmer's market. I'm used to paying more for my produce from the little farmers; they just can't do loss leaders when they only sell a dozen types of veggies. Surprisingly, though, I found that basil was cheaper and more bountiful at the farmer's market ($2.00 for a giant-sized bunch vs. $2.29 for a little plastic package at Safeway), and raspberries were about the same price ($3.00 per pint) though the Safeway version was far less appealing and fresh.

Hong Kong -- $56.89
Taipei, Taiwan -- $59.29

Our Chinese-language bloggers from Engadget China gathered prices for us from Hong Kong and Taipei, where we were interested to see that ground beef was enormously expensive ($11.30 a pound in Taipei) and packaged cereal was extremely cheap (80 cents for a box of Corn Flakes). Gas is very pricey on the island of Hong Kong, $8.30 a gallon, while Coca-Cola is cheap everywhere (around $1.50).

Frankfort, Germany -- $61.08
Esbe Market

I don't know what rice I expected Germans might eat, but I didn't think it would be Uncle Ben's. It is! And it's not cheap; a 1kg box is €3.49, or $2.49 per pound. Kayt also reported that "they didn't have a whole chicken at the store (you usually go to the Metzgerai for that) but chicken breasts were €8.40 per kg, one of our highest prices in the world as a result. Kayt also shopped the farmer's market for us in Frankfort, where fresh strawberries were €2.99 for 500g, or about $2.00 per pint. A bargain!

Madrid, Spain -- $71.81
El Corte Ingles

Madrid and Los Angeles were eerily similar in prices, with milk, ground beef, bananas and chicken within a few quarters of each other. Madrid residents don't, it appears, eat Cheerios (we found Corn Flakes for about $2.92 per box) and the rice was the most expensive in the world at $3.57 per pound.

Paris, France -- $105.28
Carrefours

When I was a senior in college, I spent a few days in Paris and got up early one morning to shop a street market. I remember not being able to afford very much. I still wouldn't be able to afford to shop in Paris, even though I'm now not a starving student; it's the most expensive food basket in WalletPop's World Food Price Index. White bread ($3.07), tofu ($10.00 per pound) and maple syrup (a whopping $28.33 per liter) were particularly pricey.

Brussels, Belgium -- $87.82

Gaby shopped both at a supermarket and at her neighborhood grocery market and had all kinds of interesting notes in her report, such as this one about ground beef; it was "2.25 Euros ("carbonnade" cut at cheap butcher's shop) or 4.45 ("steak tatare cut" at normal or quality butcher's shop)." As for potatoes, she made a distinction: "0.50 Euro/500 gm (new potatoes); old potatoes are 0.30 Euro/kg." Old potatoes! I love that. As for fruit, she said, "1.50 and 2 Euros for a 500-gm tub of currants and strawberries, respectively. Raspberries are 2-3 Euros for half that; cultivated blueberries are 2.50 Euros for a 500-gm tub." It's interesting that, in America, the distinction is made with wild blueberries, but cultivated blueberries are just "blueberries."

Kuwait City -- $55.43
Yaw9eel.com

In Kuwait, we expected the gas to be cheap, and it was -- the price came out to an almost insane $0.78 per gallon. But what really blew us away was the coffee: 27 cents a pound! Now that's black gold. An interesting tidbit: In Kuwait City, eggs are sold by the basket of 30, instead of by the dozen.

Moscow, Russia -- $69.11
Ramstore

Who would have thought that potatoes would be $4.45 per pound in Russia -- one of the highest worldwide prices? Gas, however, is a veritable steal at $2.10 per gallon.

Brazil -- $34.19

Coffee was also cheap in Brazil thanks to its proximity to so many equatorial coffee growers; $2.10 per pound. Lemons, at six cents apiece, must have been in season. Bananas, too, are local in Brazil and only 25 cents per pound. All this seems fitting for a tropical nation. But the biggest surprise was maple syrup, $1.65 per liter.

How much does ground beef cost in your supermarket? In my local Safeway, it's $3.49 a pound, but at the specialty market where I shop to get beef that was raised by local farmers and grass-fed, it's $3.99 a pound; a fair price, I think, though my grocery budget is seriously straining my family's finances. In Little Rock, Arkansas, where a few of my blogging mama friends shop, ground beef is only $3.10 per pound, and the sample grocery basket of 20 items we created at WalletPop costs only $39.72; it's $63.85 in Portland, Oregon, where I live.

But what about my friends in Adelaide, Australia? London, England? Brussels, Belgium? In Adelaide, Jessica shopped at Coles and found that "4 Star Choice" (lean but not extra lean) was AUD6.54 per 500g -- or $5.75 per pound. In London, Catherine shopped at Waitrose and found ground beef priced at £4.99 per 500g -- a whopping $9.03 per pound, the second most expensive of all the cities where we shopped (the priciest was Paris, where ground beef is $11.03 per pound). In Brussels, Gaby reported ground beef to be €2.25 per pound ("carbonnade" cut at cheap butcher's shop) or €4.45 per pound ("steak tatare cut" at normal or quality butcher's shop) -- $3.54 per pound, nearly the same as here in Portland.