Foodservice Equipment Reports

Wholesale Food Prices Fall Again, Menu Prices Tick Up Slightly

Food prices at the wholesale level fell in two of the three stages of processing again in December, while menu prices rose only 0.1%, according to the latest data from Bureau of Labor Statistics Producer Price and Consumer Price Indexes.

Wholesale food prices at the “finished” level were down 0.6% in December after being flat in November; a 13.4% drop in prices for fresh and dry vegetables led the decline. Prices at the “intermediate” level rose 0.4%, as prices for animal feeds continued to rise, up 2.3%. But the gain came on the heels of a 0.9% decline in November and a 1.5% drop in October. The increased prices for animal feeds are helping push prices for proteins, especially beef, higher. At the crude level, food and feedstuff prices fell 0.3%, the same as in November.

On the consumer side, the entire CPI rose only 1.5% on a seasonally unadjusted basis in 2013. That compares with a 2.1% gain in 2012 and a 3.2% increase in 2011.

Menu prices ended the year 2.1% higher without seasonal adjusting. Food-at-home prices rose only 0.4% for the 12 months. The food-at-home index has risen only once—0.1%—in the past four months.

Despite the very muted increases in food prices at both the wholesale and retail levels last year, there is increasing concern about prices this year. Beef prices are definitely on the rise, as ranchers have culled herds. But the extreme drought in California and other areas of the country is expected to have an effect on fruit and vegetable prices.
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