USDA significantly raises food inflation outlook for 2022
USDA has significantly raised its food inflation forecast for the year. Average prices were up 1 percent in January, followed by another 1 percent in February.
In any given year, the average food inflation is 2.4 percent. USDA says that means in just the first two months of the year, we’ve already seen a typical yearly increase.
According to USDA economist Matt MacLachlan, “For the ‘All Food’ category, we’re expecting prices to increase between 4.5 and 5.5 percent. We are predicting that food away from home prices, this is food consumed away from the household, will increase between 5.5 and 6.5 percent. Food at home, we are predicting that for the whole year they will be between 3 and 4 percent above where they were last year.”
In January, USDA predicted food prices would only rise 3 percent this year.
Among the price increases, USDA predicts poultry will increase as much as 7 percent this year, but economists say that the impact of avian flu outbreaks on domestic prices is not yet clear. It could result in decreased population or decreased access to international markets. Wholesale prices are already up 25 percent from early 2021.