Food Price Outlook

The all-items Consumer Price Index (CPI), a measure of economy-wide inflation, increased by 1.4 percent from May 2022 to June 2022 before seasonal adjustment, up 9.1 percent from June 2021.

Photo:  Pennsylvania Beef Council

Food Price Outlook

The all-items Consumer Price Index (CPI), a measure of economy-wide inflation, increased by 1.4 percent from May 2022 to June 2022 before seasonal adjustment, up 9.1 percent from June 2021. The CPI for all food increased 1.0 percent from May 2022 to June 2022, and food prices were 10.4 percent higher than in June 2021.

The level of food price inflation varies depending on whether the food was purchased for consumption away from home or at home:

The food-at-home (grocery store or supermarket food purchases) CPI increased 1.0 percent from May 2022 to June 2022 and was 12.2 percent higher than June 2021; and

The food-away-from-home (restaurant purchases) CPI increased 0.9 percent in June 2022 and was 7.7 percent higher than June 2021.

In 2022, food price increases are expected to be above the increases in 2020 and 2021. In 2022, food-at-home prices are predicted to increase between 10.0 and 11.0 percent, and food-away-from-home prices are predicted to increase between 6.5 and 7.5 percent. In 2023, food-at-home prices are predicted to increase between 2.0 and 3.0 percent, and food-away-from-home prices are predicted to increase between 3.0 and 4.0 percent.

Recent Historical Overview

Between the 1970s and early 2000s, food-at-home prices and food-away-from-home prices increased at similar rates. Since 2009, however, their rates of growth have mostly diverged; while food-at-home prices deflated in 2016 and 2017, monthly food-away-from-home prices have been rising consistently since then. The divergence is partly due to differences between the costs of serving prepared food at restaurants and retailing food in supermarkets and grocery stores.

In 2020, food-at-home prices increased 3.5 percent and food-away-from-home prices 3.4 percent. This convergence was largely driven by a rapid increase in food-at-home prices, while food-away-from-home price inflation remained within 0.3 percentage points of the 2019 inflation rate. The largest price increases were for meat categories: beef and veal prices increased by 9.6 percent, pork prices by 6.3 percent, and poultry prices by 5.6 percent. The only category to decrease in price in 2020 was fresh fruits, by 0.8 percent.

In 2021, food-at-home prices increased 3.5 percent and food-away-from-home prices increased 4.5 percent. The CPI for all food increased an average of 3.9 percent in 2021. Of all the CPI food-at-home categories tracked by the U.S. Department of Agriculture (USDA), Economic Research Service (ERS), the beef and veal category had the largest relative price increase (9.3 percent) and the fresh vegetables category the smallest (1.1 percent). No food categories decreased in price in 2021 compared with 2020.

CPI Forecast Changes This Month

The ranges for 10 food categories and 4 aggregate categories were revised upward this month. No food price categories were revised downward.


The large increases in all-food and food-at-home prices in June followed similarly large changes in January through May. These price increases were driven by increases for many products. Prices for eight food categories increased by at least 1.0 percent in June, including increases of 2.0 percent for three of these categories. The impacts of the conflict in Ukraine are expected to put upward pressure on food prices, and the recent increases in interest rates by the Federal Reserve are expected to put downward pressure on food prices. The effects of these situations will be closely monitored as they unfold in order to assess their concurrent impacts on food prices. In 2022, all food prices are now predicted to increase between 8.5 and 9.5 percent, food-away-from-home prices are predicted to increase between 6.5 and 7.5 percent, and food-at-home prices are predicted to increase between 10.0 and 11.0 percent.

Prices for the aggregate category of meats, poultry, and fish increased by 0.4 percent between May 2022 and June 2022. Beef and veal prices declined 0.6 percent in June 2022 and have remained steady or declined for 3 consecutive months. Prices for other meats, which include frankfurters and lunch meats, rose 1.0 percent in June 2022 and increased 16.7 percent between June 2021 and June 2022. In 2022, other meat prices are now predicted to increase between 12.0 and 13.0 percent, and the aggregate category of meats, poultry, and fish is predicted to increase between 9.0 and 10.0 percent.

Poultry prices increased 1.5 percent in June 2022 and 17.3 percent between June 2021 and June 2022, with persistently low stocks of frozen chicken (also called “cold storage”). Retail egg prices increased 0.3 percent in June 2022, following large increases in April and May, and are 33.1 percent higher than June 2021. An ongoing outbreak of highly pathogenic avian influenza (HPAI) has reduced the U.S. egg-layer flock, and the poultry flock to a lesser extent. This outbreak has contributed to elevated egg prices and increasing poultry prices as over 40 million birds in 37 States have been affected. The disease prevalence also negatively impacts international demand for U.S. poultry. Price impacts of the outbreak will be monitored closely. Poultry prices are now predicted to increase between 14.5 and 15.5 percent in 2022.

Fish and seafood prices rose by 0.5 percent in June 2022, climbing to 11.0 percent above June 2021 prices. Among the subcategories of fish and seafood, fresh fish and seafood prices declined by 0.4 percent and processed fish and seafood prices increased by 1.4 percent. Fish and seafood prices are now predicted to increase between 9.5 and 10.5 percent in 2022.

Rapid increases in the consumption of dairy products have driven increases in retail prices in recent months. This trend continued in June 2022 with a 1.4-percent increase in the prices for dairy products. Dairy product prices are predicted to increase between 12.0 and 13.0 percent in 2022.

Following large price increases in January through June 2022, forecast ranges for fats and oils, processed fruits and vegetables, sugar and sweets, cereals and bakery products, nonalcoholic beverages, and other foods have been adjusted upward. Economy-wide factors including ongoing supply chain issues and higher energy, transportation, and labor costs, contributed to increases in prices across food categories. In 2022 compared with 2021, fats and oils prices are now predicted to increase between 16.5 and 17.5 percent, processed fruits and vegetables prices between 8.5 and 9.5 percent, sugar and sweets prices between 7.5 and 8.5 percent, cereals and bakery products prices between 12.0 and 13.0 percent, nonalcoholic beverages prices between 7.5 percent and 8.5 percent, and other foods prices between 12.0 and 13.0 percent.