Modest inflation forecast for fresh produce

06/25/2013 01:21:00 PM
Tom Karst

Retail prices for fresh fruits and vegetables are expected to rise between 3% and 5% in 2013, according to a government forecast.

In its June 25 food price forecast, the U.S. Department of Agriculture’s Economic Research Service estimates retail fresh fruit prices will rise 3% to 4% this year after rising only 1% in 2012.

Fresh vegetable retail prices will climb between 4% and 5% this year, compared with 5.1% deflation in 2012, according to the USDA report.

The USDA-ERS inflation forecast for both all food and food-at-home prices in 2013 is 2.5% to 3.5%.

“This forecast means that prices are likely to increase more than in 2012, but that overall inflation is expected to be near the historical average for both indexes,” according to a report summary.

Strongest inflation is associated with animal-based food products due to higher feed prices. For most other food products not affected by the drought, inflation for 2013 will be at or perhaps below normal levels, according to the USDA-ERS.

Fresh fruit prices increased 2.4% in May, the USDA said, and the fresh fruit retail index is up 2.1% compared with a year ago. Retail apple prices were 12.4% higher, while banana prices are 1.1% down and citrus prices up 1.2%.

Fresh vegetable prices at retail declined 2% in May, with fresh vegetable prices up 3.3% compared with a year ago. Potato prices are down 6.1%, lettuce prices are up 4.4% and tomato prices were up 11.4% compared with a year ago, according to the USDA.



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