Retailers are locked in a Thanksgiving turkey price war

Retailers are locked in a Thanksgiving turkey price war, cutting into margins to hold onto cost-conscious consumers.Why it matters: Americans are feeling squeezed, with grocery prices about 30% higher than before the pandemic — and millions facing new food insecurity after the government's SNAP benefits freeze.That strain is reshaping where people shop — and how far retailers will go to keep them.Most people say they're paying more for groceries now than a year ago, even as the administration insists prices are going down, not up.The big picture: The nation's turkey flock has shrunk to its smallest size in 40 years, and a rebound in avian flu cases this fall is keeping pressure on supply and prices.Nearly 1.3 million turkeys have been impacted by outbreaks since October, mostly in Minnesota and nearby states, according to USDA data.State of play: The National Turkey Federation says there will be enough birds for Thanksgiving, though fresh and specialty turkeys could tighten if flu cases accelerate.Thanksgiving meal costsBy the numbers: Prices are rising for grocers, falling for consumers — and someone has to make up the difference.$1.73 per pound is the going wholesale rate for frozen hens, about 40% higher than 2024.Yet the latest USDA data says frozen turkeys are selling at retail for 25 cents per pound less than a year ago.Between the lines: Many retailers are selling turkeys at or below cost to draw shoppers in for higher-margin items like wine, desserts and décor — a classic loss-leader strategy that works for big chains such as Walmart, Aldi and Kroger but squeezes smaller grocers."Turkeys are kind of the loss leader on the Thanksgiving table," Leslee Oden, National Turkey Federation president and CEO, recently told Axios.Turkey retail promotions surged ahead of Thanksgiving, with the USDA reporting Friday a sharp rise in national feature activity and frozen whole birds now leading grocery ads.Thanksgiving price wars 2025Zoom in: Nearly every major grocer is cutting deep to prove its value — though many are also shrinking bundles or swapping in cheaper store-brand items to keep costs down.Walmart is matching last year's meal prices, feeding 10 for about $4 per person, though its bundle includes fewer items than in 2024.Aldi's $40 meal for 10 — about $4 each — is cheaper than last year's and includes a 14-pound turkey.Lidl's $36 meal for 10 is nearly $10 less than last year's, with turkeys priced at 25 cents per pound through its app.Kroger revived its Freshgiving bundle for under $4.75 per person, its cheapest in four years, anchored by private-label items.Target cut prices on 3,000 items and brought back its meal for four under $20, a penny less than last year, swapping two items and keeping turkey at 79 cents per pound.What they're saying: Retail analyst Bruce Winder tells Axios this is "the most aggressive pricing environment since the pandemic.""Grocers can't afford to keep losing money on food forever," he added. "But in a market where loyalty is everything, they see it as the cost of staying relevant."The bottom line: America's affordability crisis is reshaping the holiday season. Everyone's discounting turkeys — but someone's footing the bill. Retailers are absorbing the pain to show shoppers they still have their backs.

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