Food Price Outlook, 2023 and 2024
This page summarizes the December 2023 forecasts, which incorporate the November 2023 Consumer Price Index and Producer Price Index numbers.
See the Overview page for Consumer Price Index and Producer Price Index datasets.
Consumer Price Index for Food (not seasonally adjusted)
The all-items Consumer Price Index (CPI), a measure of economy-wide inflation, decreased 0.2 percent from October 2023 to November 2023 and was up 3.1 percent from November 2022. The CPI for all food decreased 0.2 percent from October 2023 to November 2023, and food prices were 2.9 percent higher than in November 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 decreased 0.5 percent from October 2023 to November 2023 and was 1.7 percent higher than November 2022; and
- The food-away-from-home (restaurant purchases) CPI increased 0.4 percent in November 2023 and was 5.3 percent higher than November 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 5.9 percent. Food-at-home prices are predicted to increase 5.0 percent, with a prediction interval of 4.9 to 5.1 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 in 2024. In 2024, all food prices are predicted to increase 1.2 percent, with a prediction interval of -2.0 to 4.7 percent. Food-at-home prices are predicted to decrease 0.6 percent, with a prediction interval of -5.3 to 4.6 percent, and food-away-from-home prices are predicted to increase 4.9 percent, with a prediction interval of 3.2 to 6.6 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 November 2022 to November 2023) due to high within-year price growth in 2022. For example, although food-at-home prices were only 1.7 percent higher in November 2023 than in November 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 1.7 percent higher in November 2023 than in November 2022, falling below 2.0 percent for the first time since June 2021. Prices declined for 10 food-at-home categories between October and November 2023. Five food-at-home categories had lower prices in November 2023 than in November 2022: eggs, fresh vegetables, fish and seafood, dairy products, and pork. In 2023, prices are expected to increase for all food-at-home categories except pork.
Beef and veal prices decreased 1.3 percent in November 2023 but remained 8.7 percent higher than November 2022. Prices for beef and veal fell for the first time in 2023 in November, after increasing each month from January to October. Beef and veal prices are predicted to increase 3.6 percent in 2023, with a prediction interval of 3.3 to 3.9 percent.
Pork prices fell 2.8 percent in November 2023 due to weak demand and were 0.5 percent lower than in November 2022. Pork prices declined in the first half of 2023 but had experienced strong growth from July through October. Pork prices are predicted to decrease 1.1 percent in 2023, with a prediction interval of -1.4 to -0.9 percent.
Retail egg prices increased 2.2 percent from October 2023 to November 2023 but were 22.3 percent below November 2022 prices. The ongoing outbreak of Highly Pathogenic Avian Influenza (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 76 million birds, 438 commercial flocks, and 47 States. HPAI was confirmed in egg layers in November 2023 for the first time since December 2022. Price impacts of the outbreak will be monitored closely. Egg prices are predicted to increase 0.7 percent in 2023, with a prediction interval of 0.0 to 1.4 percent. Poultry prices are predicted to increase 3.2 percent in 2023, with a prediction interval of 3.0 to 3.4 percent.
Prices for fats and oils decreased by 1.3 percent in November 2023 but were 3.0 percent higher than November 2022. Prices for fats and oils are predicted to increase 8.9 percent in 2023, with a prediction interval of 8.7 to 9.2 percent. Fats and oils is a category that had high within-year price growth in 2022 of over 20 percent, which contributes to the difference between its forecast annual change and its recent year-over-year trend.
Prices for fresh fruits increased 1.2 percent from October to November 2023 and were 2.1 percent higher than November 2022. Prices for fresh vegetables declined 0.1 percent and were 3.1 percent below November 2022. 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 0.7 percent in 2023, with a prediction interval of 0.4 to 1.0 percent. Prices for fresh vegetables are predicted to increase 0.9 percent in 2023, with a prediction interval of 0.6 to 1.2 percent. Prices for processed fruits and vegetables decreased 2.9 percent from October to November 2023, the largest single-month decrease in the history of this category. Processed fruits and vegetables typically undergo a seasonal decline in prices in November, and prices for farm-level vegetables have declined from their peak in November 2022. Despite the decrease in prices for processed fruits and vegetables from October to November, prices for processed fruits and vegetables are predicted to grow more quickly than fresh fruits and vegetables in 2023. Prices for processed fruits and vegetables are predicted to increase 7.8 percent in 2023, with a prediction interval of 7.6 to 8.0 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 October and November 2023 for six PPI categories and rose for seven categories. Greater volatility in farm- and wholesale-level prices lead to 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 17.9 percent and 25.6 percent higher, respectively, in November 2023 compared to November 2022. Farm-level cattle prices are predicted to increase 22.3 percent in 2023, with a prediction interval of 21.5 to 23.2 percent. Prices for wholesale beef are predicted to increase 13.4 percent in 2023, with a prediction interval of 12.0 to 15.0 percent.
Wholesale poultry prices decreased by 10.9 percent in November 2023 and were 19.6 percent lower than November 2022. Wholesale poultry prices are predicted to decrease 18.5 percent in 2023, with a prediction interval of -18.8 to -18.1 percent.
Prices for farm-level eggs increased by 58.8 percent from October 2023 to November 2023, as new cases of HPAI were confirmed in egg-layer flocks in November 2023 for the first time since December 2022. Prices were still 46.5 percent lower than November 2022, following several months of large price decreases in early 2023. The effects of recent HPAI cases on farm-level egg prices will be closely monitored. Farm-level egg prices are predicted to decrease 28.1 percent in 2023, with a prediction interval of -30.4 to -24.6 percent. Egg prices are the most volatile category tracked by USDA, ERS, leading to a wide prediction interval.
Prices for farm-level fruits increased 18.3 percent in November 2023 but were 6.1 percent lower than November 2022. Prices for farm-level vegetables increased 11.2 percent in November 2023 but fell to 53.2 percent below their peak prices in November 2022. Prices for farm-level fruits are predicted to decrease 0.8 percent in 2023, with a prediction interval of -1.9 to 0.4 percent, and farm-level vegetable prices are predicted to decrease 11.2 percent in 2023, with a prediction interval of -12.9 to -9.0 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.
