Thanksgiving Dinner Costs Decline as Turkey Prices Fall

After experiencing rising food prices for some time, Americans are seeing a bit of relief when it comes to Thanksgiving meals, notably due to falling turkey prices.

This year, the overall cost of traditional holiday meals is expected to decrease, with turkey, rolls, and stuffing leading the way. According to recent data from Wells Fargo and the American Farm Bureau Federation (AFBF), while some side dish prices remain high, the total cost of a typical Thanksgiving meal is likely to drop by 3% to 6%.

Wells Fargo estimates that a Thanksgiving dinner for ten people will range from $80 to $95, depending on whether shoppers opt for store brands or national brands. In contrast, AFBF reports the national average cost at about $55.18, which translates to approximately $5.52 per person. This reflects a 5% decrease from last year, although prices are still around 13% higher compared to pre-pandemic levels.

The AFBF noted that the lowest meal costs can be found in the South, at approximately $50.01, followed by the Midwest at $54.38, the Northeast at $60.82, and the West at $61.75.

Stephanie Carles, a retail insights expert at RetailMeNot, mentioned that this price drop is largely due to easing supply chain challenges and intensifying competition among grocery stores.

“Discount retailers are playing a significant role in this year’s pricing,” Carles noted. Many supermarkets are increasingly relying on private label products, as they tend to offer better value without sacrificing profit margins. This creates more chances for shoppers to save money while still maintaining quality.

Various stores like BJ’s Wholesale Club and HEB are also aware of tighter budgets and are offering free turkey promotions and holiday meal bundles to assist families in hosting without overspending. Such competitive pricing strategies are contributing to the reduction in overall food costs this season.

Walmart, Lidl, Aldi, and Target have even announced some of the most affordable Thanksgiving meals in years, priced between $3.60 and $5 per person for gatherings of four to ten.

On average, the cost of a 16-pound frozen turkey is now $21.50, marking a 16% reduction from the previous year, according to AFBF data. Brandon Parsons, an economist from Pepperdine University, explained that while demand has stayed about the same over the years, this year’s price decline is essentially driven by supply factors. Increased turkey production and a decrease in the impact of avian influenza have helped boost supply.

This year, turkey accounts for a smaller percentage of the overall Thanksgiving meal cost—39%, to be precise—the lowest proportion seen in 25 years.

Furthermore, other staples like dinner rolls have also seen a price drop, with prices about 22% lower than last year, averaging around $3.56 a dozen. Sales of stuffing, gravy, and cranberries are also down by about 3% to 4% compared to last year.

However, not all items are cheaper. Agricultural products and dairy prices, for example, continue to fluctuate. While turkey and wheat products have benefitted from better production conditions, other agricultural categories still face supply challenges.

Some items have seen significant price hikes; sweet potatoes, for instance, have surged by 37% to about $4 for a three-pound bag, while fresh vegetables like carrots and celery have increased by 61% to approximately $1.36 per pound. Factors such as hurricane damage, labor shortages in agriculture, and the inherent volatility of the market have all contributed to these increases.

Martin Rayo, an agricultural expert, noted that regions like Mississippi, a key producer of sweet potatoes, faced over 70 days of drought this summer, which resulted in smaller yields.

On the beverage front, beer prices have gone up by about 3%, while wine prices have remained stable. Soft drinks showed mixed results; while 12-ounce cans decreased by 3%, 2-liter bottles increased by 7%.

Despite these price drops, many Americans are still opting for smaller celebrations this Thanksgiving, often trimming costs by mixing homemade and store-bought items.

Carles concluded that while falling turkey prices are a positive sign, it doesn’t necessarily indicate that food inflation is on a downward trend. Seasonal discounts can offer temporary relief, but a broader view of inflation must consider various factors.