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Plan to Pay More for Your Independence Day Barbecue

Liza McCorkle | E+| Getty Images

Some of the favorite foods for your Fourth of July barbecue—burgers, steaks, chicken and fresh fruit–will cost you significantly more than last year. And last summer's drought has a lot to do with it.

The latest USDA Price Outlook shows the Consumer Price Index for all food is 1.4 percent higher than last year, with the biggest price spikes for most animal-based food products.

Overall beef prices are about 1.7 percent higher than May 2012. Ground beef is up 1.1 percent.

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"These prices are high," said Richard Volpe, an economist with the USDA Research Service. "For many beef products, ground beef in particular, we are looking at record prices even when adjusted for inflation."

Supermarkets typically run specials on beef at the start of the barbecue season–and that has already started to happen. But Volpe does not expect prices to drop below last year's.

Maybe you're cutting down on meat and eating more chicken. You've probably noticed that those chicken prices have been climbing all year, too. Poultry prices right now are 5.6 percent higher than a year ago, according to the USDA report.

"That's pretty substantial," Volpe said. "We've seen much higher than average inflation for chicken prices recently and those prices are high right now as we head into the summer grilling season."

Both beef and poultry producers say consumers are feeling the lingering effects of last summer's drought, which devastated the nation's corn crop, a major component of livestock feed.

"Higher corn prices have resulted in less chicken coming to market and higher prices for what did," said Tom Super, vice president of communications at the National Chicken Council.

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Burger lovers will find ground beef selling for about 10 cents a pound more than a year ago.

The National Beef Cattlemen's Association believes beef prices have started to stabilize. The rancher's message to shoppers: Beef is still a reasonably priced source of protein.

"The average retail price for a serving of beef is about a dollar," said Trevor Amen, the association's director of market intelligence.

More to Come

"Prices for beef, chicken and poultry are going to continue going up," said Phil Lempert, food industry analyst and editor of SupermarketGuru.com. "So when you see something on sale, whether it's Hebrew National hot dogs or chicken breast, stock up and put it in the freezer."

Just be sure to do it properly. Lempert recommends wrapping the food in aluminum foil and then putting it into a zip-lock type freezer bag. Be sure to mark the outside of the bag with the date. For best quality, you want to use it within six months.

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Family-size packs of beef or chicken are another way to stretch your food dollars. They give you a variety of items at a lower price per pound.

You can also save if you do some of the prep work yourself. It's a lot cheaper to buy a whole chicken and cut it up yourself rather than get prepackaged chicken breasts. Lempert said the dark meat is great for grilling.

There is one bit of good news. The latest USDA report says because of a decline in exports and increased hog production, retail pork prices so far in 2013 are well below those of 2012.


—By Herb Weisbaum, CNBC. Follow him on Facebook and Twitter or visit The ConsumerMan website.

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