After two years of higher-than-usual inflation rates, food prices will rise by a near-normal 2.5 percent in 2022, said the USDA in its first estimate of food costs in the coming year. High prices for meat and fresh food are forecast to drive the food inflation rate to 3 percent this year.
Food prices rose 3.4 percent in 2020, the largest increases in nine years, due to the pandemic, which forced a near-shutdown of restaurants and created spot shortages in grocery stores. Outbreaks of Covid-19 slowed meat production and drove up retail prices for beef, pork and poultry. Meat prices are rising more rapidly than usual this year as the economy recovers, but the increases are not at large as last year. The rate will slow noticeably, to 2.5 percent, in the new year, said the Food Price Outlook.
Restaurant and carry-out food prices will rise an average of 3.5 percent in 2022, well above the 20-year average of 2.4 percent annually, said the USDA. Meanwhile, grocery prices will rise 2 percent. “Food away from home,” the category for restaurant, cafeteria and carry-out food, has seen higher annual inflation than groceries for more than a decade. “The divergence is partly due to differences between costs of serving prepared food at restaurants and retailing foods in supermarkets and grocery stores,” says the USDA.
The Food Price Outlook is available here.