Thanksgiving dinner 2022: Consumers face double-digit price increases

The cost of the annual Thanksgiving feast is expected to take a major bite out of consumer budgets with prices of some staples showing double-digit percentage increases. 

According to estimates from the United States Department of Agriculture, all food prices will be up 9.5% to 10.5% in 2022, but grocery prices are predicted to increase between 11% and 12%. The rise in costs are the result of lower production and higher labor and transportation expenses as well as disease, bad weather and Russia's war in Ukraine.

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With rising prices, the average cost of this year's classic Thanksgiving meal for 10 is projected to be approximately $64.05, which is up 20% from 2021, according to the Farm Bureau’s 37th annual survey. The main dish alone is projected to cost around $28.96 for a 16-pound bird, which is up 21% from last year, according to the survey. 

Due to the current economic climate, economists are even beginning to question whether it is a better economic choice to eat out. 

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According to a Wells Fargo report titled "Is This the Year to Dine Out for Thanksgiving?" the cost of staples from poultry to fruits will outpace the total food at home and food away from home categories on the Consumer Price Index (CPI). The report analyzed the cost differences from November 2021 to August 2022 using CPI data. 

Wells Fargo sector managers Courtney Buerger Schmidt and Brad Rubin and chief agricultural economist Michael Swanson already projected turkey prices would rise more than 20% compared to the fourth quarter last year. 

They also cautioned that turkey supplies will be "more limited" due to continuing impacts of the Highly Pathogenic Avian Influenza. 

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"Turkey prices jumped after the bird flu wiped out livestock earlier this year. While inventory has rebounded, the cost per pound will be higher," the authors noted. 

Buerger Schmidt and Rubin also warned that egg prices, which have also been impacted by the bird flu, have already risen 32.5% from November 2021 through August 2022. Meanwhile, butter and flour increased 25.8% and 17.1%, respectively, according to their findings. 

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Fruits and vegetables had the lowest cost increase, with prices rising 7.3%. 

Rubin told FOX Business that consumers are also going to see a difference in popular side dishes, such as potatoes and cranberry sauce, due to weather issues and a rise in input costs this year. 

For instance, the cooler spring in Idaho and Washington had delayed crops of potatoes and onions while the hotter temperatures in California coupled with the drought "shrunk the yield of celery, carrot, and onion crops," according to the report. 

Meanwhile, "cranberry sauce, a staple of the holiday meal, will cost more on grocery store shelves due to cranberry producers that faced rising input costs," the report continued. 

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Americans can find some relief in prices, though, if they seek out alternatives such as sweet potatoes. Sweet potatoes for instance "have a surplus at the moment and are more readily available," Rubin told FOX Business. 

"Consumers can find better pricing on that commodity than on white potatoes, which are on a short crop and prices will be higher based on supply and demand principles," he added. 

Still, the cost of groceries are rising so much that smaller families might want to consider eating out, according to Rubin. 

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"According to Consumer Price index cost of eating out has increased slower than at home, so while eating out is considered a luxury it is a great value this year," Rubin added. 

For a family of four, the cost could be similar and eating out would be the most economically beneficial this year, according to Rubin. 

However, for a bigger family gathering, it will be more economical to eat at home, he noted.  

The Associated Press contributed to this report.