Retail pork prices soared last year, part of an overall 11.4 percent increase in grocery prices, but they will decline this year by 1.1 percent, said USDA's monthly Food Price Outlook on Monday. The report forecast a grocery inflation rate of 5.1 percent this year and a below-normal 1.6 percent in the new year.
Although the U.S. inflation rate is up for the second month in a row, the annualized food inflation rate of 4.3 percent is the lowest since the 3.7 percent rate in August 2021, said the Bureau of Labor Statistics on Wednesday. The food inflation rate has fallen each month since peaking at 11.4 percent in August 2022.
Although world cotton production is forecast to be the highest in six years, there are “some concerning dark clouds on the horizon” as the 2023/24 season begins, said the International Cotton Advisory Committee.
In its first forecast of 2024 food costs, the government said grocery prices would climb by a modest 0.9 percent next year. If so, it would be the lowest annual grocery inflation rate in five years and mark the end of the period of high food inflation that followed the pandemic. Also on Tuesday, USDA economists lowered their forecast of grocery price inflation for this year for the fifth month in a row.
Chicken breasts and pork chops cost less at the supermarket than a year ago, and that will slightly bring down the price of a summer cookout, said the largest U.S. farm group on Tuesday. Still, the price tag for the groceries needed to feed 10 people lemonade, ice cream, burgers, potato salad, and other cookout fare would be the second-highest in the 11 years of the unofficial survey conducted ahead of Independence Day.
Farm-state senators will try to move $37 billion into the farm bill that originally was earmarked for a handful of USDA activities, including climate mitigation, in the climate, health and tax law last summer, said a Senate Agriculture Committee senior staffer on Monday.
The financial outlook for many farmers is favorable, thanks to high commodity prices, but higher interest rates are an ongoing concern, according to ag bankers surveyed by the Federal Reserve. Interest rates on loans to farmers were 3.5 to 4.5 percentage points higher in the opening months of this year than they were at the end of 2021.
Although food inflation slowed for the sixth month in a row, it still was far above the annualized U.S. inflation rate of 6 percent, said the Labor Department on Tuesday. The food inflation rate of 9.5 percent was the lowest since last April, the last time the rate was below 10 percent.
The U.S. food inflation rate fell for the fifth month in a row to 10.1 percent for the past year, said the Labor Department on Tuesday. Food, the second-largest consumer expenditure after housing, was a factor in the persistently high U.S. inflation rate. USDA analysts estimate food prices will rise by 7.1 percent this year, the highest in three decades although a slowdown from 2022.
Fears of persistently high world food prices, sparked by Russia’s invasion of Ukraine and disruption of global supply chains, have subsided but food affordability remains a challenge at the household and macro-economic levels, said three analysts on Tuesday. “These risks will remain high” in …
The highest interest rates in years will complicate farm finances, and operators should expect higher rates to persist for several years as part of efforts to quash inflation, said a team of agricultural economists on Wednesday. Farmers will pay more when they borrow money, face higher break-even levels on investments, and feel downward pressure on the value of farmland, their largest asset.
The food inflation rate declined in November for the third month in a row to its lowest level since June, said the Labor Department on Tuesday. Despite the improvement, food prices are 10.6 percent higher than they were a year ago, according to the Consumer Price Index report.
High commodity prices, due in part to warfare in Ukraine, will propel U.S. net farm income to a record $160.5 billion this year, despite a steep climb in expenses, said the Agriculture Department on Thursday. Farm income, a gauge of profitability, would be 14 percent higher than last year.
Congress is on the cusp of overhauling the farm program but the top question among farmers about government action is interest rate policy, which lies outside the jurisdiction of the Senate and House Agriculture committees, said a Purdue University poll on Tuesday. Concern about interest rates coincided with the Federal Reserve campaign to squelch inflation through regular increases in interest rates.
The high food inflation rate this year will bleed into 2023, said the Agriculture Department on Tuesday, raising its forecast for the new year to 3.5 percent. It was the first adjustment since USDA economists began inflation forecasts for 2023 in July.
By far, inflation is the No. 1 issue in rural America ahead of the midterm elections, said the Daily Yonder Rural Poll on Monday. Six of every 10 of the likely voters in the survey said they would vote for Republicans in congressional races, roughly the same margin won by former president Trump in 2020; three in 10 said they would vote for Democrats.
The Federal Reserve will continue to raise interest rates into 2023, "and the outlook for the coming year grows increasingly gloomy," said agricultural lender CoBank on Monday. The strong dollar "will pressure U.S. exports as the global economy struggles and U.S. goods remain expensive," it said, with warfare in Ukraine injecting additional volatility into world food supplies.
Grocery prices will rise an average of 11 percent this year, the largest year-on-year increase since 1974, when prices soared by a torrid 14.9 percent, said the USDA. The monthly Food Price Outlook said grocery inflation would ebb to a near-normal 2.5 percent in 2023.