Inflation-adjusted prices for a few food categories have fallen since 1985

Over the past 30 years, grocery store prices have risen 4.5 percent above economy-wide prices, indicating that food prices have risen faster than some other consumer goods, such as housing and transportation. Inflation-adjusted (real) prices for poultry and dairy products have been stable, while real prices for red meats, eggs, and fresh fruits and vegetables grew by 18, 21.5, and 40 percent between 1985 and 2014, respectively. Over the same time period, real prices for fats and oils, sugar and sweets, and nonalcoholic beverages fell. A main ingredient in many nonalcoholic beverages is corn sweeteners, which have decreased in price nearly 20 percent since 1985. Processed foods, many of which are included in the sugar and sweets category, are less affected by commodity-level price swings and are generally more closely linked to the costs of inputs such as electricity and wages. Industrial electricity costs and manufacturing wages both increased at a rate about 10 percent lower than overall inflation since 1985. This chart appears in “Growth in Inflation-Adjusted Food Prices Varies by Food Category” in ERS’s July 2015 Amber Waves magazine.

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