The Food Institute Works with OU Kosher to Help Consumers Get the Most Bang for the Buck on Food Pur

March 28, 2008

For the first time since 1990, prices for food-at-home rose over four percent last year and could very likely do so again in 2008, with projections from the United States government suggesting an increase of as much as 4.5 percent. Many consumers, as well as many food manufacturers and retailers, are finding this to be unfamiliar turf and are looking for ways to deal with the higher prices.

Indeed, mothers (and fathers) aged 30 or under, likely have never had to deal with such increases in their food bills. Even major food processors have commented that this is uncharted territory for many executives who came of age after 1990.

At The Food Institute, however, which was founded in 1928, we have seen food prices fluctuate widely. For example, in 1973 and 1974, prices for food rose 16.4 percent and 14.9 percent, respectively — dwarfing last year’s 4.5 percent increase and a similar increase forecast for 2008. Of course, President Nixon had implemented price controls in prior years, which resulted in a surge in food costs when those controls were eliminated.

At times like these, consumers often look for ways to economize and get the most bang for their buck at supermarkets; these include clipping coupons and switching to lower-priced alternatives such as store brands, also known as private labels. These days, however, consumers are not only looking for the lowest prices. They are also concerned about the quality and “healthiness” of the foods they feed their families. In the past decade, this search for quality and healthiness has led to increased demand for organic foods, as well as for kosher products. Fortunately, many private label products are now certified kosher, as well as many major brands, which makes this task simpler in many respects.

Even before this current rise in prices, consumers and manufacturers wanted to know more about kosher certification. At The Food Institute we were often asked by food manufacturers and marketers, both large and small, “How can we become certified kosher?” In the past four to five years, however, this question was being asked more and more often.

As result, The Food Institute and the Orthodox Union held a well-attended webinar on kosher certification late last year in order to educate food manufacturers and marketers about kosher certification and the Orthodox Union, the world’s largest and most respected kosher certification agency. The attendees learned about the importance of kosher certification to all consumers, as well as some of the steps they would need to take to have their products certified.

Prior to that, Rabbi Eliyahu Safran, Vice President of Communications and Marketing at OU Kosher, spoke to over 100 attendees at a one-day seminar on food labeling sponsored by The Food Institute in Newark, NJ. He spoke about kosher certification and the Orthodox Union, to the delight of those in an audience that included manufacturers and retailers, both large and small. Another labeling seminar is currently slated for June 6 in Newark and possibly on the West Coast at a later date, due to the large audience seeking information on food labeling issues. At both, additional questions regarding certifying food as kosher are certain to arise.

At The Food Institute, we do not anticipate this interest in kosher certification will recede in light of higher food prices. Indeed, many manufacturers will see it as a way to further validate the wholesomeness of their products and hopefully to increase to demand as well, as consumers seek out a kosher symbol on the products they buy.

In the United States, consumers spent just 9.9 percent of their disposable income on food in 2006, about the same percentage as they have spent for the prior decade — among the lowest percentages spent for food across the globe. In 1990, when food inflation was predominant, this percentage was 11.1 percent, while back in the Depression era, food accounted for about one-quarter of the nation’s disposable income. Advances in the food production from the farm to the fork have helped make this change possible in the United States. At the same time, the U.S. enjoys having the safest and most readily available food supplies across the globe; having kosher certified foods abundantly available will help insure that this condition continues in the 21st century.