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Food prices, as measured by the Consumer Price Index, increased 4.1 percent in 1987, compared with a 3.2-percent rise in 1986. The larger rise reflected a 4.3-percent increase in prices of food bought in grocery stores for consumption at home compared with a 2.9-percent rise in 1986. The prices farmers received for commodities, as measured by the farm value of USDA's market basket of foods, rose 2.3 percent. Farm value of foods had dropped 8 percent the previous 2 years. The farm-to-retail price spread of USDA's market basket of foods rose by 6.2 percent, partly reflecting higher food industry labor costs from rising employment. Higher advertising, packaging, and other food marketing expenses also contributed to the rise in the farm-to-retail price spread.


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