Brought to you by WBIW News and Network Indiana
Last updated on Wednesday, November 2, 2011
(UNDATED)(CNNMoney) - Peanut butter prices are rising following one of the worse peanut harvests in decades.
Kraft will raise prices for its Planters brand peanut butter by 40% starting this week, while ConAgra has instituted increases of more than 20% for its Peter Pan brand.
J.M. Smucker, which makes Jif, will introduce price hikes of around 30% . And prices could go higher.
Prices for a ton of runner peanuts, commonly used to make peanut butter, hit nearly $1,200 this month, according to the U.S. Department of Agriculture. That's up from just $450 per ton a year ago. Overall, the USDA projects that American peanut production will hit 3.6 billion pounds this year, down 13% from last year.
Analysts attribute this drop to the intense heat and drought that hit the southern U.S. this year, as well as to high prices for other crops that led farmers to focus their efforts elsewhere.
Americans spend almost $800 million on peanut butter every year.
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