Here’s What You Need to Know About Food Inflation In 2023
Eggs are expensive. Bread is expensive. Every food we see in the grocery store is expensive right now. An anonymous Reddit user said it best: “I will never understand how in my lifetime a sandwich has gone from a poverty food to basically a luxury item.” If you’re concerned about inflation or wondering where it’s headed, I’m here to help. Let’s break down the 2023 Summary from the USDA (United States Department of Agriculture) together.
A basic principle we need to know before diving in: Consumer Price Index (CPI). This figure is a national measure of economic inflation and the basis of which the USDA makes their findings and predictions. How is CPI computed? It’s kind of fun: Researchers go through grocery stores and place well-known items most Americans are known to buy in a basket. Once the basket is full, said researchers calculate the current price of the basket versus the previous year’s total and multiply by 100. Simple but effective.
Looking over the last year, the CPI rose 6.4% which reflected in a 10.1% increase in overall food prices. This level of inflation varies on whether the food was purchased for at-home consumption or away-from-home (restaurant) consumption. At-home food prices rose 11.3% while away-from-home prices only rose 8.2%. Sparknotes version: While eating at home was more expensive, percentage-wise, overall food consumption was pricier.
It may be time for some (slightly) good news. According to the economic forecast provided by the USDA, food prices are expected grow more slowly than they did in 2022. They will still increase (I said it was slightly good news) but at a slower pace. Even President Biden has put forth efforts to help Americans fight inflation, allowing the use of Medicaid to buy groceries.
So why the hell are eggs so expensive? If you’ve been doing your math, you know that egg prices have increased much more than 11.3% — in fact, they’ve risen 70.1% above their January 2022 prices. That means a dozen eggs that retailed for $4.99 a year ago are now priced around $8.49, making each egg grow in price from $0.41 per egg to $0.70.
This price increase isn’t just about CPI and overall inflation; these prices are due mainly in part to a strain of the avian flu, HPAI, that has decimated egg-laying birds as well as chickens used for consumption. The USDA reports that a staggering 47 states have lost stock due to HPAI with over 58 million birds being affected. If a chicken has been infected with HPAI, both its egg and itself are unusable for consumption. Unfortunately, these kinds of outbreaks don’t clear up overnight. Estimates are reporting that egg prices will rise another 38.4% through 2023.
Some silver lining to take away here is that some of your favorite restaurants are trying to help fight inflation! Chain restaurants like Red Lobster, The Cheesecake Factory, Chick-fil-A, and more are working on at-home versions of their fan favorites at reasonable prices. These new releases work for everyone as it lets people stay home and eat price conscious versions of their favorite restaurant’s food while the restaurants still reap the benefits of at-home consumption. On top of that, their brand is now in everyone’s freezers so when the time is right, their customers will already have their favorite restaurant in mind for dinner.
If you’re interested in learning more about the USDA’s forecasts and summaries, click here. The information might be overwhelming but interesting and important nonetheless.
