U.S. consumers will pay more for meat and eggs this year than forecast earlier, while overall food inflation will hold steady at the 3 percent to 4 percent projected a month ago, the Department of Agriculture said.
The USDA left its 2011 food-price forecast unchanged for the seventh straight month, at a rate that would be the highest since 2008. The department kept its estimate for the increase in retail food costs for 2012 steady at 2.5 percent to 3.5 percent, in a report released today on its website.
“Cost pressures on wholesale and retail food prices due to higher food commodity and energy prices, along with strengthening global food demand, have pushed inflation projections upward” from previous years, Richard Volpe, a USDA food-inflation economist, wrote in a note accompanying the report. “Price levels in 2012 will hinge significantly on several macroeconomic factors, such as weather conditions, fuel prices and the value of the U.S. dollar.”
The agency increased its 2011 projection for meats, poultry and fish expenses by a half of a percentage point, to 5.5 percent to 6.5 percent. It raised its egg-price forecasts for both years, estimating a gain of 5 percent to 6 percent this year and 3.5 percent to 4.5 percent next year.
Earlier this month, the Bureau of Labor Statistics said consumer food costs rose 0.5 percent in August, capping a 12- month gain of 4.6 percent.
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