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Food economist discusses price trends

A food economist says the rate of food price increases is starting to moderate.

David Ortega with Michigan State University tells Brownfield that doesn’t mean prices will revert to pre-pandemic levels.

“Consumers are seeing some relief, for example, egg prices—those have come down, but overall food prices remain elevated,” he says.  “And so we’re still seeing consumers trading down, seeking out sort of cheaper alternatives.”

USDA reports food at home prices have increased more than seven percent in the latest food price outlook but are down from more than 11 percent in 2022.  Ortega says inflationary pressures persist the most for cereal and bakery items, fruit and vegetables, and fats and oils.

Ortega recently contributed to a Government Accountability Report which analyzed factors causing price increases the past few years.  He says some issues are persistent.

“And in many cases, they are still there—things like animal feed costs, fertilizer costs, as well as the effects of animal and plant diseases,” he says.

Others like the COVID-19 pandemic, access to packaging, increased consumer demand, droughts in 2021, the Highly Pathogenic Avian Influenza virus outbreak in 2022, and the Russia-Ukraine conflict are shorter-term influencers.

Ortega tells Brownfield he’s interested in following consumer spending to see how demand keeps up with higher prices this year.