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Food inflation in 2021 continued at same pace

artisteer/iStock/Thinkstock meat case
Some food categories saw sharper increases than others.

Retail food prices increased by 3.5% in 2021, equal to the rate in 2020 and greater than the historical annual average of 2.0% from 2000 to 2019, according to USDA’s Economic Research Service.

USDA ERSfood_inflation_450px.png

Prices in six food categories increased in 2021 at a faster rate than in 2020 as well as in years prior. Meat prices rose 7.7% year over year, the most of any included product groups, due to strong domestic and international demand, high feed costs, and supply chain disruptions. Winter storms and drought impacted meat prices in the spring, and processing facility closures due to cybersecurity attacks affected beef and other meat production in May. Beef and veal increased 9.3% year over year, pork increased 8.6% and poultry rose by 5.1%.

Prices for fresh fruits increased 5.5% in 2021 compared to a 0.8% decrease in 2020 and a 1.6% average increase over the prior 20 years.

ERS noted that dairy products and fresh vegetables, in particular, had significantly slower price increases in 2021 than 2020 and their historical averages. Dairy product prices increased at 1.4% in 2021 versus 4.4% in 2020 and fresh vegetable prices increased by 1.1% percent compared to 2.6% in 2020.

USDA, Economic Research Service (ERS) researchers project that prices for food-at-home, or food purchased typically from grocery stores or other food stores, will increase between 1.5 and 2.5%, respectively, in 2022, lower than the 3.5% increase that occurred in both 2020 and 2021. 

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