“I think it’s safe to say that inflationary pressures have reached their worst,” claims research economist Ricky Volpe of the USDA’s Economic Research Service, in an interview with FoodNavigator-USA.
The USDA expects average food prices at retail to be up 4-5% in 2011, after a period of relatively stagnant food price inflation, he said. The historical norm over the past 20 years has been about 3%, but commodity prices have combined with high fuel prices, a weak dollar and a stagnant economy, boosting the rate of inflation.
“We see no reason to expect food prices to actually turn around and come back down,” he said, but added that the rate of food price inflation is likely to return to a more normal level of about 3-4% in 2012.
As for specific ingredients, Volpe said that meat, eggs, dairy, and fats and oils have all seen particularly large price jumps in the past 12 months.