Food inflation rolls on, but retail group says grocers are working to keep prices low

With year-over-year grocery food inflation still running above 10%, January numbers from the Consumer Price Index triggered more alarm for shoppers.

The January 2022 to January 2023 overall inflation rate for all consumer items was 6.4%, the CPI report from the Bureau of Labor Statistics said.

The all-items index increased 6.4% for the 12 months ending January, the smallest 12-month increase since the period ending October 2021. 

The all-items less food and energy index rose 5.6% over the last 12 months, its smallest 12-month increase since December 2021. The energy index increased 8.7% for the 12 months ending January 2023, and the food index increased 10.1% over the last year. 

The report said grocery food prices were up 11.3% and restaurant food prices were up 8.2% compared with the same period the previous year.

Though potato and lettuce retail prices were sharply higher, most fresh fruits and vegetables showed restrained retail price increases compared with dairy, egg and cereal categories, the report said.

In a statement, FMI’s Andy Harig, vice president of tax, trade, sustainability and policy development at the food industry association, said the CPI numbers reflected continued volatility for food prices. At the same time, he said there is hope that food inflation will fade in the months ahead.

“The January CPI illustrates that inflationary price increases are not resetting as quickly, or as uniformly, as consumers would like. Unfortunately, it is likely that food prices will remain elevated in the short term, and we anticipate that there could be further volatility in terms of inflation rising and falling in the coming months,” Harig said in the statement. “Yet we continue to remain cautiously optimistic that the worst of food price inflation is behind us.”

The statement said food retailers are striving to keep costs down for consumers.

“FMI’s latest consumer survey finds that shoppers are spending $151 per week on average, which remains below the pandemic peak of $161 per week despite persistent levels of inflation over the past year,” Harig said in the statement. “To help consumers stretch their food dollar, grocers have dramatically increased investment in their store brand offerings, among other strategies. Even as the inflationary outlook remains uncertain, retailers will continue to invest in ways to help shoppers save and work to ensure prices stay as low and as stable as possible so that customers can most effectively manage their grocery budgets.” 

From January 2022 through January 2023, here are retail price changes for food categories, compared with the same period the previous year:

• Dairy and related products — up 14%.
• Eggs — up 70.1%.
• Meats, poultry, fish and eggs — up 8.1%.
• Cereals and cereal products — up 15.9%.
• Fresh fruits and vegetables — up 5%.
• Fresh fruits — up 3%.
• Apples — up 8.5%.
• Bananas — up 2.7%.
• Citrus fruits — up 3.7%.
• Oranges and tangerines — up 4.8%.
• Fresh vegetables — up 7.4%.
• Potatoes — up 12.4%.
• Lettuce — up 17.2%.
• Tomatoes — up 3.9%.
• Other fresh vegetables — up 5.4%.