Food Price Outlook, 2023 and 2024
This page summarizes the November 2023 forecasts, which incorporate the October 2023 Consumer Price Index and Producer Price Index numbers.
See the Overview page for Consumer Price Index and Producer Price Index datasets.
The all-items Consumer Price Index (CPI), a measure of economy-wide inflation, was unchanged from September 2023 to October 2023 and was up 3.2 percent from October 2022. The CPI for all food increased 0.3 percent from September 2023 to October 2023, and food prices were 3.3 percent higher than in October 2022.
The level of food price inflation varies depending on whether the food was purchased for consumption at home or away from home:
- The food-at-home (grocery store or supermarket food purchases) CPI increased 0.3 percent from September 2023 to October 2023 and was 2.1 percent higher than October 2022; and
- The food-away-from-home (restaurant purchases) CPI increased 0.4 percent in October 2023 and was 5.4 percent higher than October 2022.
Food prices are expected to grow more slowly in 2023 than in 2022 but still at above historical-average rates. In 2023, all food prices are predicted to increase 5.8 percent, with a prediction interval of 5.7 to 6.0 percent. Food-at-home prices are predicted to increase 5.2 percent, with a prediction interval of 4.9 to 5.4 percent. Food-away-from-home prices are predicted to increase 7.1 percent, with a prediction interval of 7.0 to 7.2 percent. Food prices are expected to continue to decelerate but not decline in 2024. In 2024, all food prices are predicted to increase 2.9 percent, with a prediction interval of -0.9 to 6.8 percent. Food-at-home prices are predicted to increase 1.6 percent, with a prediction interval of -4.0 to 7.8 percent, and food-away-from-home prices are predicted to increase 4.3 percent, with a prediction interval of 2.3 to 6.3 percent.
The USDA Food Price Outlook forecasting methods are based entirely on statistical models that are fitted to recent trends in the data. These methods provide prediction intervals that narrow over the forecast period as more data become available and the degree of uncertainty declines. Discussions of price changes focus on the midpoint of these forecast intervals (titled “Mid” in the workbooks) and use the lower and upper bounds of a 95-percent prediction interval—based on past data, the annual level of inflation is expected to fall in this interval 19 out of 20 times—to reflect the level of uncertainty (titled “Lower” and “Upper” in the workbooks, respectively).
The Food Price Outlook forecasts the annual percentage change in prices by averaging observed and forecast prices for all months in the current year compared to all months in the previous year. Following a year of high price growth like 2022, the annual forecast percentage change can be higher than recent year-over-year change (i.e., from October 2022 to October 2023) due to high within-year price growth in 2022. For example, although food-at-home prices were only 2.1 percent higher in October 2023 compared to October 2022, food-at-home prices in January 2023 were 11.3 percent higher than January 2022. While price growth has moderated in 2023, which the year-over-year values reflect, the forecast captures the annual change from all months in 2023 compared to 2022. For a summary of forecasting methods used in the Food Price Outlook, see ERS Refines Forecasting Methods in the Food Price Outlook.
Recent Historical Overview
Between the 1970s and early 2000s, food-at-home prices and food-away-from-home prices increased at similar rates. However, between 2009 and 2019, their growth rates diverged; while food-at-home prices deflated in 2016 and 2017, monthly food-away-from-home prices rose consistently. Differences between the costs of serving prepared food at restaurants and retailing food in supermarkets and grocery stores partly explains this difference.
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 their prices in 2020.
In 2022, food prices increased by 9.9 percent. Food-at-home prices increased by 11.4 percent, while food-away-from-home prices increased by 7.7 percent. All food price categories tracked by USDA, ERS increased by more than 5 percent, and all food categories grew faster than their historical average rate. Following an outbreak of Highly Pathogenic Avian Influenza (HPAI), egg prices had the largest price increase (32.2 percent) between 2021 and 2022 of any category tracked by USDA, ERS. Beef and veal prices increased the least (5.3 percent) between 2021 and 2022 and generally declined from peak prices in November 2021.
CPI Forecast Changes This Month
Year-over-year price increases continued to slow for all food, food at home, and food away from home. Food-at-home prices were 2.1 percent higher in October 2023 compared to October 2022, the lowest year-over-year increase since June 2021. Prices declined for three food-at-home categories between September and October 2023. Four food-at-home categories had lower prices in October 2023 compared with October 2022: eggs, fresh vegetables, fish and seafood, and dairy products.
Prices are expected to increase for 12 food-at-home categories in 2023: beef and veal (4.0 percent), other meats (4.6 percent), poultry (3.4 percent), fish and seafood (0.4 percent), dairy products (4.0 percent), fats and oils (9.3 percent), fresh vegetables (0.9 percent), processed fruits and vegetables (8.5 percent), sugar and sweets (8.9 percent), cereals and bakery products (8.5 percent), nonalcoholic beverages (7.2 percent), and other foods (6.8 percent). The prediction intervals of each of these categories are at or above zero.
Beef and veal prices increased 1.0 percent in October 2023 and rose to 8.9 percent higher than October 2022. Beef and veal prices have increased each month in 2023, in contrast to 2022 when prices fell or remained steady for 10 months of the year. Beef and veal prices are predicted to increase 4.0 percent in 2023, with a prediction interval of 3.3 to 4.8 percent.
Pork prices increased by 1.7 percent in October 2023, and pork prices have risen by at least 1.0 percent in each month since July 2023. However, pork prices in October were only 0.3 percent above October 2022 prices following price decreases earlier in the year. Prices are expected to decrease for pork in 2023, though its measure of uncertainty does not rule out either an increase or decrease. Pork prices are predicted to decrease 0.4 percent in 2023, with a prediction interval of -1.0 to 0.2 percent.
Retail egg prices increased 0.1 percent from September 2023 to October 2023 and were 22.2 percent below October 2022 prices. The ongoing outbreak of HPAI in 2022-23 contributed to elevated egg and poultry prices by reducing U.S. egg-layer and poultry flocks. The outbreak has affected more than 63 million birds, 371 commercial flocks, and 47 States. HPAI was confirmed in commercial egg layers in November 2023 for the first time since December 2022 and in commercial turkey flocks in October 2023 for the first time since April 2023. Price impacts of the outbreak will be monitored closely. Egg prices are predicted to increase 0.4 percent in 2023, with a prediction interval of -1.0 to 2.0 percent. Poultry prices are predicted to increase 3.4 percent in 2023, with a prediction interval of 3.0 to 3.8 percent.
Prices for fats and oils increased by 1.8 percent in October 2023 and were 2.8 percent higher than October 2022. Prices for fats and oils are predicted to increase 9.3 percent in 2023, with a prediction interval of 8.8 to 9.8 percent. Fats and oils is a category that experienced high within-year price growth in 2022, over 20 percent, which contributes to the difference between its forecast annual change and its recent year-over-year trend.
Prices increased 0.9 percent for fresh fruits from September to October 2023, only partially due to seasonal factors, while fresh vegetable prices decreased 0.6 percent in October 2023, unrelated to seasonal factors. Prices for fresh fruits and vegetables are predicted to continue their slow growth relative to other categories from 2022. Prices for fresh fruits are predicted to increase 0.5 percent in 2023, with a prediction interval of -0.1 to 1.2 percent. Fresh vegetables prices are predicted to increase 0.9 percent in 2023, with a prediction interval of 0.3 to 1.6 percent.
Producer Price Index for Food (not seasonally adjusted)
A Producer Price Index (PPI) resembles a CPI in that it reflects price changes over time. However, instead of retail prices, a PPI provides a measure of the average prices paid to domestic producers for their output. PPIs are reported for nearly every industry in the goods-producing sector of the economy. Three major PPI commodity groups are of interest to food markets: unprocessed foodstuffs and feedstuffs, processed foods and feeds, and finished consumer foods. These farm- and wholesale-level prices give a general sense of price movements across various stages of production in the U.S. food supply chain.
The PPIs are typically far more volatile than the downstream CPIs. Price volatility decreases as products move from the farm to the wholesale sector to the retail sector. Because of multiple processing stages in the U.S. food system, the CPI typically lags movements in the PPI. The PPI is thus a useful tool for understanding what may soon happen to the CPI.
USDA, ERS does not forecast industry-level PPIs for unprocessed, processed, and finished foods and feeds. However, these prices have historically shown a strong correlation with the all-food and food-at-home CPIs.
PPI Forecast Changes This Month
Prices declined between September and October 2023 for 10 PPI categories and rose for 3 categories. Greater volatility in farm- and wholesale-level prices lead to much wider prediction intervals for these products compared to retail-level products. Prices are predicted to decrease in 2023 for 11 PPI categories and are predicted to increase for 2 categories.
Prices are expected to increase in 2023 for farm-level cattle and wholesale beef. Prices for farm-level cattle and wholesale beef were 28.8 percent and 27.0 percent higher, respectively, in October 2023 compared to October 2022. Farm-level cattle prices are predicted to increase 23.3 percent in 2023, with a prediction interval of 21.5 to 25.3 percent. Prices for wholesale beef are predicted to increase 13.0 percent in 2023, with a prediction interval of 10.3 to 16.2 percent.
Wholesale poultry prices decreased by 0.9 percent in October 2023 and were 8.4 percent lower than October 2022. Wholesale poultry prices are predicted to decrease 16.7 percent in 2023, with a prediction interval of -17.4 to -15.9 percent. The effects of recent HPAI cases on wholesale poultry prices will be closely monitored.
Prices for farm-level eggs declined by 10.8 percent from September 2023 to October 2023, after 4 months of price increases. Prices were 59.7 percent lower than October 2022, following several months of large price decreases between January and May 2023. Farm-level egg prices are predicted to decrease 31.8 percent in 2023, with a prediction interval of -34.9 to -26.5 percent. Egg prices are the most volatile category tracked by USDA, ERS, leading to a wide prediction interval.
Prices for farm-level fruits declined 6.2 percent in October 2023 and were 18.1 percent lower than October 2022. Prices for farm-level vegetables decreased 1.7 percent in October 2023 and fell 41.8 percent below prices in October 2022. Prices for farm-level fruits are predicted to decrease 2.7 percent in 2023, with a prediction interval of -4.5 to -0.6 percent, and farm-level vegetable prices are predicted to decrease 11.2 percent in 2023, with a prediction interval of -14.6 to -6.9 percent.
Farm-level wheat prices decreased 6.0 percent in October 2023 and were 33.0 percent lower than October 2022. Farm-level wheat prices are predicted to decrease 23.0 percent in 2023, with a prediction interval of -24.6 to -21.2 percent.
For official USDA farm-level price forecasts, see World Agricultural Supply and Demand Estimates at a Glance. For additional information, detailed explanations, and analyses of farm-level prices, see USDA Economic Research Service Outlook publications including Livestock, Dairy, and Poultry, Oil Crops, Wheat, Fruit and Tree Nuts, and Vegetables and Pulses.
See the Overview page for Consumer Price Index and Producer Price Index datasets.