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Higher food costs here to stay, increases moderating

An ag economist says increases in food costs at home are starting to return to somewhat normal levels.

Aimpoint Research’s Executive Advisor on Economics and Trade Dave Juday (jU-day) tells Brownfield price shifts following the pandemic have lasted longer than expected.

“With this massive inflation through 2021 and 2022 and starting to tail off in 2023, prices in general are just 19 percent higher permanently than they were in February of 2020,” he says.

While the latest Consumer Price Index says food prices were up nearly six percent for 2023, Juday says food away from home has been a driving force.

“Part of that is pent-up demand that’s coming back on incrementally, part of that would appear to be labor,” he says.

The December price index Juday says was down dramatically from 2022.  Increases to food prices at home declined by nine percent year-over-year, while away from home was about three percent lower.

The USDA is expecting consumer prices for beef and veal, fats and oils, and fresh fruit to increase in 2024.  Prices for pork, eggs, fresh vegetables, and cereal and bakery items are projected to lower reflecting the lower farmgate prices.