Fruit and vegetable prices to show moderate inflation - The Packer

Fruit and vegetable prices to show moderate inflation

03/26/2013 05:28:00 PM
Tom Karst

USDAConsumer prices for fresh fruit and vegetables will increase between 3.5% to 4.5% in this year, according to the latest U.S. Department of Agriculture forecast.

The USDA’s food price outlook predicts U.S. retail fresh fruit prices will rise 3% to 4% in 2013, after climbing 3.3% in 2011 and 1% in 2012. The USDA predicts fresh vegetable prices will jump between 4% to 5% in 2013 after falling by 5.1% last year and rising 5.6% in 2011.

Among fresh fruit commodities, the USDA said that apple prices in February were up 11.1% compared with a year ago, while citrus prices were 2.6% higher and banana prices down 0.8% compared with February 2012.

Among fresh vegetable commodities, the USDA said that potato retail prices in February were 7.6% lower than a year ago, while tomato prices were up 4.6% and lettuce prices up 24.5% compared with February 2011.

Spikes and valleys in retail prices are often short-lived for fresh produce, especially vegetables, said Dick Spezzano, president of Spezzano Consulting Services, Monrovia, Calif.

Dick SpezzanoSpezzano“If you see inflation or deflation, give it 30, 60 or often 90 days and it usually reverses direction,” Spezzano said.

Spezzano said that the Chilean fruit deal has been uneven so far this season, with some retailers disappointed in volume and quality.

Retailers have typically enjoyed strong first quarter sales in recent years because of strong Chilean fruit imports, along with gains in domestic and imported berry volume.

“There are some holes in that (this year) with Chile being so slow in hitting any real production,” Spezzano said.

The USDA forecast for all food pegs overall retail inflation at 3% to 4% this year, compared with a gain of 2.6% in 2012 and a 3.7% hike in 2011.

Inflation for meat is expected to remain strong in the first half of 2013 because of higher feed prices, according to the USDA forecast.

Food consumed at home is expected to increase in price from 3% to 4% in 2013, compared with a modest climb of 2.5% last year and a 4.8% price gain in 2011. Meanwhile, retail prices for food away from home will climb from 2.5% to 3.5% in 2013, up from a rise of 2.8% in 2012 and a 2.3% hike in 2011.



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