INFLATION UPDATE: Many Restaurants Expecting To Raise Prices.

Grocery prices rose by more than 1 1/2 times the overall rate of inflation in 2010, according to government statistics, and economists predict that it will be even worse this year. For months consumers have grappled with higher prices at the supermarket, while restaurateurs pulled out every kitchen trick they could to absorb food inflation costs.

Well, the party is over. Experts say restaurant-goers can expect to see as much as an 8 percent increase in their checks.

And that may not be enough to keep the big chains alive, let alone the small independent eating places. Already suffering from flagging sales and low profit margins, record-high food prices – brought on by low supplies of corn, soybeans and wheat – could be the coup de gras for many restaurateurs.

Well, the supply of dollars has exploded, so the dollar’s worth less, so it takes more dollars to buy food. And there’s also the ethanol factor: “Because corn is also used for ethanol, demand has grown so great that feed costs for farmers and ranchers are being passed on in both the wholesale and retail markets.”