New Data Shows Food Inflation Is Sticking Around
For the average American household, unprecedented global inflation levels — prompted by supply chain issues, climate-related crop shortages, and the war in Ukraine, among other factors — has led to a troubling increase in energy costs, everyday spending, and grocery prices. Average food costs have risen consecutively over the last year, leading to increases in food insecurity across the nation and the globe.
Unfortunately for the many shoppers desperate for an economic turnaround, the USDA reports that American consumers shouldn't anticipate relief at the checkout line anytime soon. As indicated by the Consumer Price Index, food prices continued to rise during the month of July, increasing by 10.9% from the previous year.
This sharp increase came after a relatively hopeful 1.1% increase in food prices between June and July. The report, which tracks the cost of various products and services over time, also painted a grim picture of grocery bills moving forward. The USDA reports that in 2022, overall food costs are estimated to increase between 8.5% and 9.5%, while at-home food prices will increase between 10% and 11%.
Consumers should anticipate increases in grocery costs through 2023
According to the USDA, grocery categories that will see some of the greatest increases in prices include meats, which are predicted to go up by 9.5% and 10.5%, and eggs, which are likely to see a staggering 24.5% and 25.5% increase in cost as a result of a widespread outbreak of bird flu earlier this year (via Bloomberg). The cost of fruits and vegetables are also predicted to increase by 7% to 8%, while farm-level milk prices are slated to go up by 36% to 39%.
While in Washington, politicians on both sides of the spectrum make campaign promises about reducing food costs, economists warn that this will be no easy task. According to Politico, despite assurances from senior White House officials that the Biden administration is actively working on policies that could lower food costs — including shipping reforms, increased fertilizer production, and initiatives that reward increased crop output — economists warn that an overall decrease in the volume of the U.S.'s agricultural supply is likely to continue driving up grocery prices moving forward.
On a more hopeful note, the USDA report indicates that although food prices will continue to increase in 2023, it will be at a much slower pace than in 2022; While food-away-from-home prices will increase an anticipated 3% to 4%, food-at-home prices are predicted to increase by just 2% to 3%. Still, for families grappling with covering ever-growing monthly grocery bills now, waiting until next year for relief could lead to economic devastation.