The following is from the February 22, 2011, edition of The Dallas Morning News. Edward Fox, the W. R. and Judy Howell Director of the JCPenney Center for Retail Excellence, provided expertise for this story.
March 1, 2011
By BRENDAN CASE
Corn, wheat and soybean prices have been jumping in recent months. So have cotton prices. And gasoline? It’s up more than 12 percent over the last three months in Dallas.
The upshot is apt to be a farewell to falling prices. Fueled by a rally in commodities, price increases are ticking up after mostly small increases or outright declines during the last 2 ½ years. . .
Consumer goods prices depend on more than raw commodities. They’re also affected by labor, transportation and other costs. So while soaring commodity prices put pressure on consumer prices, the extent of the impact remains uncertain.
It’s also unclear just how aggressively companies can pass on the burden of rising prices to consumers, given the weakness in today’s economy.
“As the cost of goods goes up because the prices of commodities have increased, consumers are going to eat some of it,” said Ed Fox, a retail and consumer behavior expert at Southern Methodist University. “But I think retailers are going to eat some of that cost, too.”
Read the full story.
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