Newspaper article THE JOURNAL RECORD

Value of Commodities Key to Holding Down Food Prices

Newspaper article THE JOURNAL RECORD

Value of Commodities Key to Holding Down Food Prices

Article excerpt

Value of Commodities Key to Holding Down Food Prices WASHINGTON - A drop in the value of some major commodities at the farm level will be a key factor in holding down consumer food prices next year, an Agriculture Department economist said Wednesday.

``Larger supplies of (farm-produced) foods will have a strong influence on food prices in 1991,'' Ralph L. Parlett Jr. told the department's annual outlook conference. ``The farm value of food, that portion of the consumer dollar which goes to farmers, is expected to average nearly 6 percent below 1990.''

Parlett's comments followed the USDA's forecast on Tuesday that consumer food prices in 1991 will climb only 2 percent to 5 percent, compared with a 6 percent gain this year and 5.8 percent in 1989. Retail food prices in the past two years have shown the sharpest back-to-back increases since they jumped 8.6 percent in 1980 and 7.8 percent in 1981. After that burst, food prices rose mostly at an annual rate of 2 percent to 4 percent - until the last two years.

Eastern Sees Resurgence MIAMI - Eastern Airlines officials claimed business surged Wednesday after the carrier gained breathing room with a massive cash infusion from a bankruptcy court escrow account. The leader of the striking Machinists union, meanwhile, urged new talks to settle the union's 21-month-old strike.

``The phones are ringing off the hook. Consumers are viewing this as a substantial vote of confidence,'' Eastern boss Martin Shugrue said in New York, where a federal bankruptcy judge Tuesday agreed to Shugrue's request to release up to $135 million from the carrier's escrow fund. Calls to Eastern reservation offices, which had run at 100,000 calls a day recently, were running 5 percent higher Wednesday, said Eastern spokesman Jim Ashlock. He said about 65 percent of the calls were to book reservations, about 15 percent higher than usual.

Travel agents said the move had temporarily put aside consumer worries about being stuck if the carrier folded. Sugrue said the new money will ensure the carrier's operations through the end of March, when he says Eastern will be ready to make a profit.

Shugrue plans a mass meeting with Eastern employees here Thursday night and will exhort them to take advantage of the opportunity the airline's been given.

``It's a Christmas present for everybody who works at Eastern,'' Ashlock said of U.S. Bankruptcy Judge Burton R. Lifland's decision. ``You can see what this enables us to do. It takes away the uncertainty and gives us a chance to make good on what we know we can do.''

Subaru of America to Trim Workforce CHERRY HILL, N.J. - Subaru of America Inc. will trim its workforce by as much as 10 percent to cut costs and restore profitability, a company spokesman said. …

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