Retail Food Inflation Projected to be Above Average in New Year
USDA narrowed its forecast of 2012 food-at-home inflation as 11 months of data is now available and December data will be published Jan. 16 that will likely show 2012 retail food price inflation in the 2.5% to 2.7% range – within USDA’s projection of 2.25% to 2.75%, according to FOOD INSTITUTE projections.
Looking ahead to 2013, retail food prices are projected by USDA to rise as much as 4% as protein prices continue to escalate. If realized, that high-end 4% level would be over a full percentage point higher than both the previous five-year average retail inflation rate of 2.94% estimated by The Food Institute as well as the prior 10-year average of 2.85%. Much of that increase is the result of higher beef and poultry prices that hit consumers in the latter part of the year. The largest increase USDA portends, however, is for fresh vegetables, which the agency sees climbing as much as 5% this year, following price declines of a comparable amount in 2012.