Did trips to grocery stores last year feel like they ate up more of your budget?
They did. But not as bad as you think, according to the latest data.
The final figures, released Jan. 11 by the Bureau of Labor Statistics, showed that in 2023 the cost of food at the grocery store rose 1.3%.
What will happen with grocery prices in 2024? Experts agree that grocery prices will continue to rise.
The price increases for food have hit some consumers harder than others. And many people have adjusted what they buy, and what they eat, to keep budgets in line.
Years of high prices
The 2023 rise in grocery costs was well below that of the 2023 Consumer Price Index, which rose 3.4%. But last year’s increase at the grocery checkout occurred on top of several years of huge price increases that began in 2020 — when the COVID-19 pandemic drove up costs while lockdowns increased the demand for food to cook at home.
Prior to the pandemic, food costs typically increased 2% per year.
“It’s certainly trending in the right direction, but you have to think there’s a number of items that are 20% to 30% higher than they were pre-pandemic,” said John Clear, an analyst of the U.S. retail sector for consulting firm Alvarez & Marsal.
In 2021, the price of groceries and food at restaurants spiked 11%, the largest increase since the 1980s, according to the Government Accountability Office.
Even with the more modest grocery inflation in 2023, the price of certain items continued to climb. Steaks, for example, rose 11.2% and ground beef went up 6.7%. And Tennessee is one of only 13 states that taxes groceries, adding 4% to the final bill along with any local sales taxes.
“Customers are shopping either less frequently or they’re shopping with the same frequency but buying less per trip,” Clear said.
Unlike rent, a mortgage payment or utilities, the grocery bill is one place where people can find ways to spend less.
“Customers have had to make choices between staples and some more luxury food items. Customers are looking at things like private label brands and are looking for deals wherever they can find them,” said Rob Ikard, president of the Tennessee Grocers & Convenience Store Association.
If food prices fall, or wages catch up with the inflation, shoppers will likely go back to their old habits, said Vaidas Lukosius, a business professor at Tennessee State University.
“We consume food daily. In general, consumers can react very quickly to price changes in grocery shopping,” Lukosius said.
Change the menu at home
Lower income consumers have a harder time dealing with rising food prices, said Middle Tennessee State University nutrition professor Janet Colson. Shoppers with a tight budget cannot stock up when food goes on sale or save money by buying larger packages.
The rising cost of food, Colson added, offers a chance to find new ways of shopping and eating that are healthier, better and cheaper.
“Frozen vegetables are the best bang for your dollar. Frozen fruits are also good. It’s really much cheaper to buy frozen strawberries and just learn to eat frozen strawberries,” she said.
Meat and pork will likely remain high, so Colson suggests exploring dried beans as a healthier and far more affordable source of protein.
“It’s kind of disheartening, but the inflation,” Colson said, “the increases in grocery prices that we’ve seen, they’re here to stay.”
Todd A. Price is a regional reporter for the USA TODAY Network newspapers in the South. He can be reached at [email protected].
This article originally appeared on Louisville Courier Journal: Inflation 2024: Grocery prices continue to rise, price hikes stacking