Over the past two years, grocery prices have increased significantly, with a 16% jump according to the U.S. Department of Agriculture. This includes food at home as well as food out of the home, with costs for items like housing, fuel, and dining out also on the rise. While the rate of inflation has fallen over the past six to 12 months, prices are still not declining but rather stabilizing at a new, higher normal. The consumer has to adjust to this new price point and expect grocery prices to remain relatively stable moving forward.
The 2024 Consumer Price Index (CPI) indicates that some items in the grocery sector are looking more stable, such as bread and milk. However, there are still several trouble spots to be aware of and budget around in the coming months. Some of these include eggs, which continue to have high prices due to bird flu impacting egg-laying hens. Beef prices have also climbed due to the lowest numbers of cattle in generations, leading to record levels of prices expected in 2024. Frozen juice costs have risen due to bacterial infections in Florida’s citrus crop, while lettuce prices have increased due to weather conditions affecting the supply.
Prices for chocolate have also gone up, with a 11.6% increase last year and more increases expected due to disease and weather impacting cocoa production in West Africa. Major companies like Hershey and Cadbury are passing these increased costs on to consumers, leading to higher prices for chocolate products. As a result, some consumers may be shifting away from chocolate snacks to other products like cookies or salty snacks in response to the higher prices. Overall, the cost of food and grocery items is likely to remain stable but at a new, higher normal moving forward.
Regarding eggs, the avian flu has caused significant losses in egg-laying hens, resulting in high prices for eggs at the grocery store. The CPI shows that egg prices are increasing once again, with no relief in sight due to ongoing issues with bird flu. For beef, low numbers of cattle in the country have led to price increases for beef and veal, with record levels expected in 2024. Frozen juice prices have also risen due to past issues with Florida’s citrus crop, while lettuce prices have been impacted by weather conditions in California and Arizona. Overall, these rising prices are likely to continue due to ongoing challenges in the agriculture and food industries.
Chocolate prices have been on the rise due to disease and weather issues affecting cocoa production in West Africa, which supplies the majority of the world’s cocoa. Major chocolate companies are passing these increased costs on to consumers. As a result, the price of chocolate products has gone up, leading to some consumers shifting their preferences towards other snacks like cookies or salty snacks. With ongoing challenges impacting various food and grocery items, consumers should continue to expect higher prices in the coming months and adjust their budgets accordingly.