Retail food prices expected to rise this year

by Talk Business & Politics staff (staff2@talkbusiness.net) 306 views 

Retail food prices ticked higher in February, up 1.5% from a year ago and 0.3% higher than in January, according to the United States Department of Agriculture.

The increase expected in food prices this year ranges from 1% to 2%, compared to a 0.4% for all of 2018.

Last year’s modest food increase was the first in three years and still below the 20-year historical average of 2%, the agency said.

Of the sixteen food specific segments monitored, ten experienced monthly price increases, while six saw price declines. The largest drops were in pork and eggs, while the largest price gains were in processed fruits and vegetables

USDA said fresh fruit prices rose 1% in 2018 and the industry expect prices will be up between 2% to 3% this year. Fresh vegetable prices rose 1.1% last year, an they are expected to be 2.5% to 3.5% more expensive throughout 2019.

The food-away-from-home segment continued to rise in consumer markets, up 2.9% from February 2018 while the food-at-home segment was up only 1.2% in the same period.

A variety of factors are being considered to account for the rise in foods prices. Traditional supply and demand is responsible for some of the increase. Also, the weather’s impact on different regions of the country – from drought to hurricanes to floods to fire – are also responsible, in part. Lastly, volatile commodity prices as well as increased costs in food packaging are also considered reasons for the jump in food prices.

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