Food Prices and Spending

Average annual food-at-home prices were 2.3 percent higher in 2025 than in 2024, less than the 20-year historical rate of 2.6 percent per year. However, rates of food price change varied widely across different categories of food at home. An ongoing outbreak of highly pathogenic avian influenza (HPAI) that began in 2022 caused egg prices to rise in early 2025. Retail egg prices fell steadily from April through December 2025 but, on average, were still 21.9 percent higher in 2025 than in 2024. The second largest food price increase in 2025 was in beef and veal (11.6 percent), followed by sugar and sweets (5.1 percent), and nonalcoholic beverages (3.8 percent). Prices for eight other food-at-home categories increased in 2025 but at slower rates than their historical averages. Prices for dairy products increased by 0.8 percent in 2025 compared with a 2.1-percent annual average rate of growth from 2006 through 2025. Prices for cereal and bakery products increased by 1.0 percent in 2025, compared with a 2.8-percent annual average rate of growth over the past 20 years. Prices for fats and oils (-0.8 percent) and fresh vegetables (-0.4 percent) declined in 2025.

In 2024 and 2025, the all-food Consumer Price Index (CPI) rose by an average of 2.6 percent per year, a smaller rate of increase than the all-items CPI, which grew 2.8 percent per year over the same 2-year period. Prices for housing (up 4.1 percent per year) and medical care (up 2.9 percent per year) increased at faster rates than prices for food. Prices for transportation (up 1.0 percent per year) increased at slower rates than prices for food over the 2-year period. Factors that impact U.S. agriculture, such as weather events and incidence of plant and animal disease, can affect food prices. Other factors that broadly contribute to inflation across the economy, such as energy prices and wages, can also impact food prices, as these factors can influence marketers’ costs for processing, transporting, and retailing food products.

For a typical dollar spent in 2024 by U.S. consumers on domestically produced food, a combined 20.1 cents went to wholesale (6.3 cents) and retail (13.8 cents) trade establishments such as grocery stores, wholesale clubs, restaurant supply stores, and other food distribution outlets. In 2024, the food services share was 38.6 cents, and the food processing share was 16.1 cents. Comprehensive updates to the Food Dollar methodology and data inputs led to replacing the former farm production industry group with three new industry groups: crops; livestock; and forestry, fishing, and agricultural services. These new industry groups attribute food supply chain value to their specific source in farm production. In 2024, their shares were 2.5 cents, 3.3 cents, and 0.9 cents, respectively. The forestry, fishing, and agricultural services share is included in “Other” in the chart.

Food prices are less volatile at the consumer level than at the farm level. The Producer Price Index (PPI) for unprocessed foodstuffs and feedstuffs captures prices paid to domestic farmers and ranchers for commodities like cattle, milk, and wheat. The annual average value of this index has changed by more than 10 percent a total of 10 times since 2006. However, these price swings have relatively small impacts on food prices. The Consumer Price Index (CPI) for food, which captures prices paid by urban consumers for food products, such as beef, cheese, and flour, at retail stores has been comparatively stable. The largest change in this index’s average annual value occurred in 2022, when the price of food rose by 9.9 percent.

Between 2006 and 2025, food and fuel prices were more volatile than prices for most other consumer goods and services, but the sizes of the price swings differed. Over the past two decades, annual household energy prices have increased as much as 17.7 percent and decreased as much as 6.3 percent. Annual motor fuel prices have increased as much as 35.8 percent and decreased as much as 27.8 percent. Food prices are comparatively less volatile. Annual food prices changed by more than 5 percent during only 3 years, peaking at a 9.9 percent rise in 2022, and rose less than 3.0 percent in both 2024 and 2025.

In 2024, nominal (i.e., not adjusted for inflation) food expenditures by U.S. consumers, businesses, and government entities reached $2.58 trillion, up from $2.48 trillion in 2023. This increase was mainly driven by growth in food-away-from-home spending, climbing from $1.45 trillion in 2023 to $1.52 trillion in 2024. Meanwhile, food-at-home spending increased from $1.04 trillion in 2023 to $1.06 trillion in 2024. Food-away-from-home expenditures as a share of total food expenditures reached a high of 58.9 percent in 2024.

In 2024, U.S. consumers spent an average of 10.4 percent of their disposable personal incomes on food, a decrease from 10.6 percent in 2023. This decline shows a small shift in consumer spending habits. Specifically, the budget share allocated to food-at-home spending decreased from 5.0 percent in 2023 to 4.9 percent in 2024. This indicates that consumers are spending a smaller portion of the money they have left after taxes on groceries and other food items they prepare and consume at home. The share of disposable income allocated to food-away-from-home spending, such as dining out at restaurants, remained unchanged at 5.5 percent in 2024.

As their incomes rise, U.S. households spend more money on food, but the number represents a smaller share of their income. In 2024, households in the lowest income quintile spent an average of $5,498 on food (representing 33.0 percent of before-tax income). Households in the middle-income quintile spent an average of $9,097 on food in 2024 (representing 12.2 percent of before-tax income). In 2024, U.S. households in the highest income quintile spent an average of $16,989 on food (representing 6.4 percent of before-tax income).

Low-income countries allocate a greater portion of their per capita income to food. As countries become more affluent, more of their disposable income is allocated to other non-food categories. In countries with higher incomes (such as the United States and the United Kingdom), the share of household spending devoted to food purchased for preparing and eating at home is relatively low—less than 10 percent. In lower-income countries (such as Nigeria), at-home food spending can reach nearly 60 percent of household spending. Per capita calorie availability follows a reverse trend, with U.S. calorie availability averaging 3,902 calories per person per day in 2025, compared with Nigeria’s at 2,470 calories per person per day.