Items By Group added to custom post type

From what I get in you question, I think you should create 3 taxonomies within the Custom Post Type UI plugin. Call these FOOD, MUSIC and CRAFTS, and attach them to the custom post type you created.

Then you’ll proceed to adding the specific items to each taxonomy. And these will automagically appear in your post-edit screen either as a text-field with autocomplete (if you create the taxonomy as non-hierarchical) or a list with checkboxes (if you create the taxonomy as hierarchical). And you’re good to go.