Already low, food inflation to slow in 2025, says USDA (2024)

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Already low, food inflation to slow in 2025, says USDA? ›

For 2025, meat prices are forecast to rise at a below-normal rate of 2.9%, said the USDA. Prices for cereal and bakery products are expected to rise at a slower-than-usual rate. Fresh fruit and vegetable prices are expected to fall.

The USDA said 2025 prices for all food are predicted to increase by 2%, with a prediction interval from down 3.2% to up 7.5%. Grocery prices are predicted to increase by 1.1%, with a prediction interval from down 6.6% to up 9.4%.

The February estimate had forecast a steep 25.5% drop from 2023, but the updated projection now shows a more moderate 4.4% decrease. USDA also revised net farm income for 2023 down from $155.9 billion to $146.5 billion, which made the decline in 2024 look less extreme.

Here's what the U.S. Department of Agriculture is saying in its forecast for 2024: “Food prices are expected to continue to decelerate but not decline in 2024.

The assumptions forecast CPI-U inflation of 2.5 percent in 2024, and 2.3 percent in 2025 and in subse- quent years.

They project that inflation will stay higher than average throughout 2023, followed by a decrease to around roughly two percent annual rise in the general level of prices until 2028. Considering the annual inflation rate in the United States in 2021, a two percent inflation rate is a very moderate projection.

Feed, fertilizer (including lime and soil conditioners), and pesticide expenses are expected to see the largest declines in 2024. Average net cash farm income for farm businesses is forecast to decrease 8.9 percent from 2023 to $106,200 per farm in 2024 (in nominal terms).

Adjusted for inflation, the USDA predicts farm income will drop by $43 billion due to lower commodity prices, higher expenses for labor and lower government payments.

The current December futures price for corn is consistent with cash prices below $4.00 at harvest, roughly $3.80 per bushel. Given usual price patterns, one expects cash prices to increase over the marketing season, and an average cash price of $4.00 per bushel for 2024 production seems reasonable.

What 3 things can beat inflation? ›

Common anti-inflation assets include gold, commodities, various real estate investments, and TIPS. Many people have looked to gold as an "alternative currency," particularly in countries where the native currency is losing value.

“While food inflation has slowed in 2024, consumers are feeling the cumulative effect of the high inflation we've experienced,” said the report's lead author, Joseph Balagtas, professor of agricultural economics at Purdue and director of CFDAS.

The Consumer Price Index for food at home from May 2024 to June 2024 was up 3% compared to June 2023. From May to June 2024, prices rose for seven food-at-home categories and dropped for six while two categories remained stable.

Bread now costs over $2 per pound — $2.03, to be exact, as of January. Last January, the same pound cost just $1.89 for a year-over-year increase of 7.7%. A standard loaf of sliced white bread weighs 20oz, which means a loaf costs about $2.54, so $20 can buy you just shy of eight loaves.

Between December 2023 and April 2024, Zimbabwe was the country with the highest level of real food inflation worldwide. Compared to the previous year, food prices had increased by 46 percent in Zimbabwe. Argentina ranked in second place with 20 percent.

In 2024, the USDA forecasts that prices for all food are predicted to increase by 2.2%, down from 5.8% in 2023. Food-at-home (grocery) prices are predicted to increase by 1%, and food-away-from-home (restaurant) prices are predicted to increase by 4.3%, the USDA reports.

Average annual inflation rate: 2.33%³

Food and drinks may be about 26% more expensive by 2030. That means a trip to the grocery store that costs you $250 now could set you back more than $314. If you like fresh fruit, your grocery bills could climb higher even sooner.

The All-India CPI-IW for May, 2024 increased by 0.5 point and stood at 139.9 (one hundred thirty nine point nine). 3. Year-on-year inflation for the month of May, 2024 moderated to 3.86% as compared to 4.42% in May, 2023.