The Impact Analytics

Grocery Inflation Index

The Impact Analytics Grocery Inflation Index tracks weekly U.S. price movements of key grocery items. We capture vast amounts of publicly available information from major grocers across multiple geographies, and because we publish more frequently than the Bureau of Labor Statistics, we generate actionable insights for our clients based on the most granular, up-to-date data available.

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Grocery claims a 15.6% share of overall U.S. retail spending. It’s a high-frequency, fairly inelastic, essential category, so any pricing changes influence discretionary spending. Because we track grocery inflation so closely, we’re able to identify trends, analyze the impact, and share more accurate insights with our clients faster than other retail planning providers.

We’ve built a basket of the most consumed grocery products in the U.S., collecting from such categories as fruits and vegetables, cereals and baked goods, dairy, meat, seafood and poultry, frozen foods, deli, and beverages. We select these items based on consumer availability, accessibility, and popularity.

The different categories are weighted based on their “average” U.S. consumption. For example, if consumers spend 20 percent of their grocery budget on dairy, then 20 percent of the basket contains dairy products. We have further classified these products into macro-nutrient food groups (protein, carbohydrate, and fat contributors), staple food and discretionary food, healthy food and unhealthy food, and plant-based and nonplant-based to help uncover any underlying price trends across each of these groups.

We then compare their prices weekly to discern price inflation and its effects.

Food Prices Increased Significantly Over the Past 12 Months

Inflation in the overall food-at-home segment (includes grocery store and supermarket food purchases) rose 3.6 percent over the last 12 months. The largest increase, 7.0 percent, was in cereal and bakery products. Offsetting that over the same time periods, meats, poultry, fish, and eggs prices declined slightly (0.2 percent). Other significant food categories displayed varying increases—from 1.3 percent (dairy and related products) to 5.4 percent (nonalcoholic beverages and other home food Items). The war in Ukraine, which is a leading grain exporter, contributed to supply-side constraints, which doubtless inflated inflation levels.

Pricing Insights from Recent Weeks: Marginal Price Increases

From December to the First Half of January, prices increased slightly: 0.20 percent. The steepest price increase (2.06 percent) was observed in fruits and vegetables followed by Nonalcoholic beverages and beverage materials (0.42 percent). Cereals & bakery products prices went up 0.22 percent and the prices of “other food at home” products decreased by 0.21 percent. Meats, poultry, fish & Eggs prices decreased 0.41 percent, while Dairy & Related products prices went down the most 0.84 percent.

Discretionary, Protein-Rich, and Non-healthy Product Prices Continue Outpacing Other Segments

Month-over-month (MoM) prices for discretionary food products increased by 0.45 percent while staple products decreased by 0.26 percent. Prices for fat-rich and protein-rich products increased by 0.39 percent, 0.44 percent respectively, and carbohydrates-rich decreased by 0.10 percent. Price increases for non-healthy products (0.16 percent MoM) slightly outpaced that of healthy products (0.09 percent). Prices for plant-based products increased by 0.23 percent while nonplant-based product prices rose 0.11 percent.

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