Retail produce prices decline for third straight month

07/18/2011 09:37:00 AM
Chris Koger

Coral BeachU.S. supermarket prices for fresh fruits and vegetables fell for the third consecutive month, led by declines in tomatoes and lettuce, as fresh produce inflation eased from a cost spike earlier this year stemming from harsh winter weather.

Average nationwide retail fruit and vegetable prices during June fell 0.4% from May, according to the U.S. Bureau of Labor Statistics’ monthly Consumer Price Index released July 15. May prices fell 1.9% from April.

Fruit and vegetable prices have declined as production returned to normal levels after freezing weather earlier this year killed crops in Arizona, Florida and Mexico, leading to shortages of some products. Prices for lettuce and tomatoes have been among the largest decliners, tumbling 3.1% and 6.1% in June from May, according to CPI data.

Fruit and vegetable prices remain above last year’s levels, reflecting accelerating food inflation that’s pushing Americans’ grocery costs higher for meat, milk and many other items. This partly reflects oil’s recent rise above $100 a barrel, with high fuel costs being passed down the production and distribution chain to the retail level, analysts said.

Fresh produce inflation in 2011 is on pace to increase 3.5% to 4.5%, the largest increase since 2008, according to a recent government forecast. Prices rose 0.6% last year.

During June, fresh vegetable prices were up 5.8% from the same month in 2010, the 16th consecutive year-over-year increase, according to the CPI report. Prices rose by an average of 6.1% during the first six months of this year.

Fresh fruit prices were up 1.8% in June, the sixth year-over-year increase in the past seven months.

Among specific products, field-grown tomatoes averaged $1.56 a pound at retail nationwide last month, down from $1.79 in May and down from $1.59 in June 2010, according to CPI data. Iceberg lettuce averaged 96.7 cents a pound, down from 96.2 cents in May but up from 88.7 cents in June 2010.

Navel oranges averaged $1.014 a pound, up nearly 10 cents from April but down 8.2 cents from June 2010. Red delicious apples averaged $1.317 a pound, down 1.1 cents from May and up 5.5 cents from June 2010. Bananas averaged 61.4 cents a pound, down from 61.7 cents in May and up from 57.7 cents a year ago.

A broader price index for food consumed at home rose 0.2 percent during June from May, the smallest monthly increase since December. But compared to June 2010, prices for food at home rose 4.8 percent, the largest year-over-year increase since February 2009.



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