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Food Stamps are about to spoil grocery stores’ outlook
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Enriched pandemic-era food stamps made a big mark on supermarket sales in the past three years. Those extra benefits are soon coming to an end, possibly spoiling supermarkets’ outlook for the year.
The federal government started beefing up households’ food budgets starting March 2020 to address food insecurity during the Covid-19 pandemic. Over the last three calendar years, that added up to about $98 billion of extra assistance—known as emergency allotments—on top of regular food stamps issued through the Supplemental Nutrition Assistance Program, or SNAP, according to HSA Consulting, a retail industry research firm. Those boosts made food stamps an important component of food sales. In 2022, SNAP benefits (including the emergency allotments) made up 12.3% of total at-home U.S. food and beverage retail sales, up from 7.1% in 2019, according to HSA Consulting.
Congress in late December put an end to that food-stamp boost, which will mean that SNAP-eligible households in 35 U.S. states and jurisdictions will lose at least $95 a month in benefits starting in March, according to the Center on Budget and Policy Priorities, a nonpartisan research and policy institute. Some states opted to stop receiving those allotments between last year and early this year.