Consumers have found plenty of bargain prices for fresh fruits and vegetables this year, a new government report reveals.
Unusually low fruit and vegetables prices have kept overall retail prices for food in check through October this year, according to the U.S. Department of Agriculture’s Economic Research Service.
Average food-at-home prices have been flat from January through October, thanks to deflation in the fresh produce sector and lower prices for milk and pork, the USDA ERS said in a food price outlook report issued in late November. On the other hand, retail prices have been higher for beef, veal, poultry, fats and oils.
Drought conditions for grain crops in the Midwest may push meat prices higher yet, but the price effect will be delayed.
The USDA ERS inflation forecast for both all food and food-at-home prices in 2012 is 2.5% to 3.5%.
Deflation has been particularly pronounced for vegetables in 2012, according to the USDA ERS.
The fresh vegetable consumer price index increased 0.6% in October but has dropped almost every month in 2012, the USDA report said. Compared with a year ago, the USDA said fresh vegetable prices are down 3.2% on average, driven lower by a 10.9% decline in potato prices, a 4.1% drop in lettuce and a 1.7% slide in tomato prices. Other fresh vegetable prices were off 0.7%, according to the USDA report.
Warmer-than-usual weather and good growing conditions this year have combined to increase yield and lower prices compared with year-ago levels, according to the USDA.
An expected seasonal increase in prices during the second half of 2012 has been less than predicted, and because of that the USDA now expects fresh vegetable prices to fall 4% to 5% in 2012. The fresh fruit price index is up 2.1% from October 2011, and the USDA projected fresh fruit prices for 2012 are now projected to fall between 1% and 2%.
Compared with October 2011, the USDA said retail apple prices are up 6.4%, with banana prices 1.4% lower, citrus prices 0.1% higher and other fresh fruit commodities up 1.3% in retail price.
The USDA projects inflation for fresh fruits and vegetables in 2013, with fresh fruit prices expected to rise between 3% to 4% and fresh vegetable prices likely to jump 4% to 5%.
Overall food price inflation for 2013 is projected between 3% and 4%. Prices for food served away from home are projected to increase 2.5% to 3.5% next year, while prices for food served at home are expected to increase 3% to 4%.