PUBLISHED: 4:49 PM on Wednesday, December 12, 2007
Bakers pounded by cost of staples
Most holiday bakers wouldn't put a price on their grandmother's decadent pound cake or a value on the cookies they make every year.

But while the recipes may be forever priceless, the ingredients that go into finished holiday cakes, pies and cookies are a lot pricier than they were last year.

The price of holiday baking staples -- like sugar, eggs, milk and cream -- have risen noticeably this year, according to bakers and the American Farm Bureau. The rising price of corn, due to ethanol production, and the fuel used to transport goods have driven up prices as much as 30 percent in some cases.

Sugar has risen 10 cents a pound, eggs by 30 cents a dozen and milk by 95 cents a gallon since Thanksgiving 2006, according to the American Farm Bureau.

While most holiday bakers won't change a routine to save 30 cents on eggs, large-scale baker Sandy Reed, co-owner of Black Forest Bakery in Athens, Ga., said she's had to change a few recipes this year to the make the most of her stores of eggs, milk and sugar.

For Reed, who buys eggs 15 dozen at a time, it seems that the price has almost doubled over last year.

"I've tried to keep my prices the same," Reed said. "Fortunately, we have an influx of shoppers at this time of year to kind of offset the higher prices we're paying. But I have tried out some alternative recipes that allow us to use less of some of these things."

So far, everyone seems to be happy with the substitutions, she said.

"We've seemed to be able to produce what we need and keep our customers satisfied," she said.

Reed usually plans for a spike in ingredient prices near the holidays, but she said she's not seen anything like this.

According to Georgia's egg and milk trade commissions, the drought, high fuel prices and the increase in corn prices fueled by increased ethanol production all have combined to drive up the cost of baking staples.

This year, egg farmers sold off hens, fearing the price would spike for feed corn, said Gene Gregory, president of the United Egg Producers.

Fewer hens means fewer eggs, and with supply down and demand high, egg prices had to rise, Gregory said.

Scarcity of feed helped drive up milk prices as well, said Rob Hainer, public relations coordinator with the Southeast Dairy Association.

This year's drought in the Southeastern states meant dairy farmers couldn't grow enough hay to feed their herds, Hainer said, so some farmers have sold off parts of their herds.

This year's sell-off -- paired with a number of dairy farmers who went out of business when milk prices reached a record low in 2006 -- means fewer cows producing milk. Fewer cows means less milk, which, as with eggs, means higher prices.

Sugar, which is tied to international production and pricing far more than eggs and milk, held a stable supermarket price -- 43 cents a pound -- from 1986 to 2005, according to the American Sugar Alliance, a sugar producers' trade group.

However, its current price of about 60 cents per pound at local grocery stores represents an almost 50 percent increase due to changes in international markets.

Although the combination of drought, decreased supply and increased demand has driven up the price of many holiday staples, the price of one Georgia baking staple has dropped about 70 cents a pound this year.

"This has been the best pecan crop Georgia's seen in 15 years," said John Steedman, owner of the North Georgia Pecan Co. in Athens. "A lot of things just happened exactly right."

The nuts thrive in relatively dry conditions, and pecan farmers turned out a bumper crop this year. Consequently, their price has dropped from about $7.95 a pound to about $7.25.

Pecans won't replace eggs or milk, but they do make a terrific pie, Steedman said.