Grocery Inflation Index

Impact Analytics Grocery Inflation Index (IA – GII) tracks price movements of key grocery items across the US on a higher frequency than the official Govt reporting. We do this by capturing price information from the major grocers across multiple geographies in the US on a weekly basis. The Index leverages Impact Analytics’ capability to capture a vast amount of publicly available data to generate valuable actionable insights for our clients.

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Pricing insights from the recent weeks: Prices in the food-at-home category stay elevated

The overall grocery price index has marched on further in June and in the early weeks of July after a rapid rise in the month of May. The categories that have experienced the most significant price increases are ‘Nonalcoholic beverages’; and 'Meats, poultry, fish, and eggs’. All other categories have registered a marginal month-on-month increase.

An unprecedented increase in food prices over the past year

Inflation in the overall food-at-home segment (incl. grocery store and supermarket food purchases) rose by 8.9% over the previous 12 months, with the largest increase of 13% observed in the meat, poultry, fish, and eggs segment. The cereal and bakery products; and fruits & vegetables segments showed significantly higher inflation than nonalcoholic beverages and beverage materials, and other food at home. A host of reasons such as unprecedented fuel price hikes (fuel prices have gone up by 42% over the past year), global supply chain disruptions, labor shortages with a sustained increase in demand, the ongoing conflict in Ukraine, the recent outbreak of avian influenza could help in understand this rise in inflation levels.

Where food prices are heading: the trend in the coming days

Our estimates show that prices climbed even higher (by 2.3% MoM) during late June and the early weeks of July 2022, with one of the steepest increases to grocery prices recorded in recent history. The meat, poultry, Fish and Eggs segment, along with cereal and bakery segment have seen 2.2% and 1.4% price increases respectively month over month while pricing in the dairy and related products segments have moderated.

Unhealthy and Discretionary Foods have become dearer

Within the food at home category, the discretionary basket (including non-staple foods such as candy, carbonated drinks, etc) increased by 9% more than staples. The non-healthy basket (cakes, cookies, cakes, rolls, sugary drinks, etc) increased by 5.64% more when compared to healthy food. Similarly, non-plant-based food prices have increased by 6.5% as compared to plant-based food price increases.

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