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Have you made a trip to the grocery store lately? Probably you are taking less groceries home, but paying much more for what you bought.
Overall, prices are still going up. But inflation has been slowing in the past year and the latest data shows the cost of groceries, at least, isn’t rising as fast as it once was. In fact, grocery prices are largely moderating, the most recent consumer price index (CPI) shows, even as the cost of eating out continues to climb. And a few supermarket categories actually got cheaper as they experienced deflation.
Food prices – which includes both food at home (groceries) and restaurant purchases – increased 2.6% from January 2023 to January 2024, according to the CPI report released Feb. 13 from the Bureau of Labor Statistics. By comparison, prices rose 10.1% over the previous one-year period in 2023.
The CPI uses indexes to measure changes in average costs of items in a given period. There are specific indexes for these items, including food costs.
Here are the broad strokes on food prices found in the latest report:
– The index for food at home is 1.2% higher year-over-year. From December to January, grocery costs rose by 0.4%.
– Restaurant patrons are still paying more (5.1%) for food than they did a year ago. And the price index rose 0.5% from December to January.
– Specifically, limited service meals (takeout only) rose 5.8% year-over-year, while full-service (sit-down restaurant) meals rose 4.3% year-over-year.
– Overall, the annual food inflation rate has been declining for more than a year.
Grocery prices don’t move uniformly. The latest CPI data show egg prices rose 3.4% from December to January – still one of the sharpest one-month increases among grocery groups tracked by the CPI. Egg prices rose sharply throughout much of 2022 and 2023, due to an avian flu. Despite the rise in prices in January, the cost of eggs is down 28.6% from a year ago.
The baby food and formula index saw the biggest annual change in the January report. Prices are 8.7% higher for those items than they were a year ago.
As a whole, food prices are expected to rise in 2024, albeit at a much slower pace than they did in 2023, according to the USDA Economic Research Service food price outlook released in January.
In fact, grocery prices could actually fall slightly in the coming year, the USDA predicts, while the cost of dining out will probably rise at a rate similar to 2023’s increase of 5.2%.
The USDA relies on statistical modeling to forecast future food prices. It updates its annual outlook on a monthly basis.
Food prices have risen steadily since 2020 thanks to a combination of factors, including inflation, labor costs, and the supply chain.
These challenges won’t be resolved in 2024 but the economic outlook and overall inflation are improving according to the USDA.
Food production costs are estimated to increase 3.8% in 2024, which is slower than they did in 2023, according to the U.S. Department of Agriculture. Labor costs are rising faster than inflation, but they’re also slowing down, according to the U.S. Bureau of Labor Statistics. This is a significant underlying factor because of the way higher wages and benefit costs ripple through the entire supply chain.
The higher food prices have forced many consumers to make different choices in the grocery aisles. In addition to higher prices for milk and eggs, fresh vegetables and fruit are much more expensive as are staples such as bread and cereal.
In this area residents are blessed with numerous monthly food give-aways by local churches and agencies, such as Hale Community Ministries, Second Harvest, ARM, Loaves and Fishes, and Carter Compassion Center, etc. Also, many school children qualify for free meals.
We are thankful to have these organizations in our midst to help struggling individuals and families.
What does Jesus say about feeding the hungry?
“For I was hungry and you gave me something to eat, I was thirsty and you gave me something to drink, I was a stranger and you invited me in, I needed clothes and you clothed me, I was sick and you looked after me, I was in prison and you came to visit me.”
That’s Christianity in action.