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Tips to Avoiding Higher Food Prices

8 ways to stretch your grocery budget during the worst drought in 50 years

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En español  |  Get ready: This summer's terrible heat and the worst drought in nearly 50 years are likely to strain your food budget. "We're looking at grocery prices to go up 3 to 4 percent" in 2013, says Richard Volpe, a Department of Agriculture economist. That's about a percentage point faster than normal, and on certain foods, the jump will be bigger.

The good news: Prices will probably hold basically steady for the rest of 2012. But here are some specific rises you can expect next year, the USDA says:

* Beef and veal: 4 to 5 percent (the largest predicted hike)

* Poultry and eggs: 3 to 4 percent

* Pork: 2.5 to 3.5 percent

* Dairy products: 3.5 to 4.5 percent

* Cereals and bakery products: 3 to 4 percent

* Fruits and vegetables: 2 to 3 percent, the normal annual rate.

So how can you eat well without eating up your savings? Here are eight ways.

1. Eat more produce. For financial reasons, 2013 may be the Year of the Vegetarian. The reason: Many of the price hikes affect farm animal feed — in July, for instance, feed corn was selling at 50 percent more per bushel than in June. This helps drive up the cost of meat and dairy products. But fruits and vegetables aren't being affected much because they're largely grown on irrigated land, which is less vulnerable to lack of rainfall. And produce is a popular loss leader; supermarkets often price it below cost to attract customers.

If you scale back on meat, consider beans and legumes as a low-cost, high-protein alternative.

Plan Ahead for Rising Food Costs: 7 ways to stretch your budget: Eat More Produce

Consider eating more veggies to save money on that grocery list. — Photo by Jeffrey Hamilton/Getty Images

2. Buy now, eat later. If you have room in the freezer, you may want to stock up on meats before next year's price hikes. Steaks, roasts and whole chicken can be frozen for up to one year, chops for about six months, and meat leftovers for up to 3 months. Canned meats are easy to store and have a long shelf life.

3. Buy big. Pound for pound, "family" or "value"-sized packages of meat will remain cheaper than smaller ones. Prices may be less at warehouse stores such as Costco and Sam's Club than in the local supermarket. (If you're not a member, consider finding a friend or neighbor and split the food and cost.)

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Ultimate Cheapskate Jeff Yeager with advice on how to save money grocery shopping.

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