If Retail Food Inflation Is Mild So Why Do Shoppers Not See It

Even though retail food price inflation has eased considerably over the past year, food prices continue to rise, and consumers are well aware of it, reports The Food Institute.

Even though retail food price inflation has eased considerably over the past year, food prices continue to rise, and consumers are well aware of it, reports The Food Institute.

Retail food prices during May were up 2.7% from a year ago, well under the 6% jumps seen in the August through September period last year based on the government’s Consumer Price Index for food-at-home. And while that is good news for the economy, for shoppers that still means prices moved yet higher, and some much more than others.

For example, center-of the-plate beef prices are increasing at a much greater rate than the overall market basket and were up 5.4% from a year ago during May. And although on a per pound basis chicken costs less, those prices were also up, nearly 4% from a year ago, during May. Pork prices are bucking that trend however and were actually down slightly from a year ago. But if consumers are not looking for pork as their dinnertime protein, higher prices prevailed.

Indeed, of the 15 food categories the Institute tracks each month, only two, pork and fresh vegetables, saw lower prices this May than last. And among those that posted increases, those advances ranged from 1.4% for eggs to a 7.8% jump in fats and oils.

And for those consumers waiting overall retail prices to decline, keep in mind that over the past 50 years on an annualized basis, retail food prices declined only once – back in 1967 on heels of a 5% increase the prior year. And the biggest jump occurred back in 1973 when government price restraints were lifted and prices jumped 16.4% in a single year. And in those 50 years, beef prices did decline a dozen times.

The Food Institute has been following pricing and trends. To find out the association’s benefits to its members, go to www.foodintsitute.com/joinfi.cfm