Thanksgiving dinner will cost more this year. Many people have already done their shopping for the holiday amid concerns about empty shelves. But those who’ve waited may get lucky.

There are signs that inflation in the price of turkeys, pies, green beans and bread rolls has peaked, for this season at least, as more supermarkets start stepping up their promotions.

According to data provider IRI, which has been tracking typical Thanksgiving foods since the start of October, prices are up 5-10% across many products compared with last year, as of the week ending Nov. 7.

Last year was characterized by more intimate holiday gatherings, which meant smaller birds or turkey breasts and individual portions of all the trimmings. This year, buying patterns should be more traditional. Food retailers including Walmart Inc. are stocking more large birds in anticipation of families getting together. Labor shortages at meat processors also led to birds growing bigger in barns as they waited longer to be slaughtered, leading to proportionally more of this size  being available in the U.S.

Retail consultancy GlobalData estimates U.S. holiday food spending — for Thanksgiving, Christmas and other occasions — will increase by 8.6% from 2020 to $53.1 billion, due to inflation but also to higher sales volumes.

Many people have been buying earlier than usual, reflecting concerns about the well-documented supply shortages. There was a surge in demand for Thanksgiving favorites in the first week of November, according to IRI. Although empty grocery shelves remain a worry,  there should be enough turkeys to satisfy demand, it estimated. However, stocks of some products, such as liquid gravy and cranberry sauce are at lower levels than last year. Some shoppers are also struggling to find the particular brands they need for their classic recipes.

Nevertheless, waiting to shop could make that grocery trip cheaper. Food retailers typically increase promotions as the holidays near, and this year is proving to no exception. Higher prices overall, but discounts for short periods, could be a taste of things to come.

There are risks in supermarkets yo-yoing between markups and markdowns, however. In Britain, the last time there were significant inflationary pressures about a decade ago, grocers responded first by raising prices and then later offering promotions to stimulate demand. That gave oxygen to discounters Aldi and Lidl, which undercut the back-and-forth by maintaining consistently low prices. With Aldi expanding aggressively in the U.S. and Lidl also finding its footing there, American retailers won’t want to make the same mistake. 

Already, there are signs that consumers are trading down in categories where prices are rising.

As my colleague Tara Lachapelle has noted, Walmart seems acutely aware of these dangers — it’s sticking to its mantra of keeping costs low for customers and talking to suppliers about how it can bring down prices. This strategy could appeal to some other consumer goods companies, which may choose to sacrifice some of their profit margins to win over customers from rivals. 

Efforts to tackle higher food prices could offer some relief to families seeing the cost of their holiday shopping soar. Now that would be something to be thankful for.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.

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