Surging pork and beef costs will keep pressure on U.S. food inflation, which the USDA says will rise 3% to 4% this year, the most since 2008.
While the overall estimate for food inflation was left unchanged in the report, USDA says prices for meat, poultry and fish will jump 5 to 6%, led by beef, which may climb 8%, and pork, which could gain 7.5%. The beef estimate was increased by 2.5 percentage points from March and pork was raised 1 percentage point.
“I suspect when December arrives we will see increases of 4 to 6%” for the year in overall prices, says Bill Lapp, the president of Advanced Economic Solutions, an agricultural-research company based in Omaha, NE. “The pressure on food prices is clearly on the upside,” says Lapp, a former chief economist for ConAgra Foods Inc.
Earlier this month, the Bureau of Labor Statistics reported that food costs rose 0.7% in March, capping a 2% gain for the first quarter. Cattle futures traded in Chicago were up 6.3% for the year through April 21, and hogs had increased 25%, on rising export demand. Crude oil surged 33%.
To read the entire article, link here.