Sunday, January 16, 2011

Food Inflation CPI Data for 2010

Food inflation is in the news everywhere. Our latest CPI figures reveal rising prices here, too, although the U.S. is the luckiest nation in the world when it comes to the smaller percentage of our annual household budgets devoted to food costs. Since the financial crisis, grocery food suppliers have generally been unable to pass on higher costs to weak consumers.

Although the 2010 food index was reported to be up 1.5 percent by the BLS, if you look closer at their report, last year's price increases of meat, poultry, fish and eggs was up 5.5 percent and dairy was up 3.7 percent, far exceeding the overall inflation rate for the year. The same can be said for energy costs which were up 7.7 percent last year. Increasing food and energy prices are further squeezing an already squeezed middle class here in the U.S.

Here are the latest CPI food and energy reports:

Food for the year 2010:
The food index turned up in 2010, rising 1.5 percent after declining 0.5 percent in 2009. The index for food away from home rose 1.3 percent; the food at home index increased 1.7 percent after declining 2.4 percent in 2009. Among major grocery store food groups, the index for meats, poultry, fish and eggs posted the largest increase at 5.5 percent followed by a 3.7 percent increase in the dairy index. The indexes for nonalcoholic beverages and cereals and bakery products were the only ones to decline.

Food for December 2010:
The food index rose 0.1 percent in December after a 0.2 percent increase in November. The indexes for food away from home and food at home both rose 0.1 percent. Within the latter group, the fruits and vegetables index rose 1.8 percent after declining in November. The index for fresh fruits rose 3.4 percent, its fourth consecutive monthly increase. The indexes for cereals and bakery products, dairy and related products, and other food at home also increased in December. In contrast, the index for nonalcoholic beverages fell 1.3 percent in December and the index for meats, poultry, fish and eggs fell 0.4 percent.

Energy for the year 2010:
A deceleration in the gasoline index accounted for much of the slowdown, as it increased 13.8 percent in 2010 after rising 53.5 percent in 2009. The index for household energy, which declined in 2009, rose 0.8 percent in 2010 as increases in the indexes for fuel oil and electricity more than offset a decline in the natural gas index. The energy index as a whole, which rose 18.2 percent in 2009, increased 7.7 percent in 2010.

Energy for December 2010:
The energy index, which rose 0.2 percent in November, increased 4.6 percent in December. The gasoline index rose 8.5 percent in December, the sixth consecutive increase. (Before seasonal adjustment, gasoline prices rose 4.5 percent in December.) The index for household energy also increased in December, rising 0.8 percent after declining 0.4 percent in November. The index for fuel oil increased 4.9 percent, and the indexes for natural gas and electricity rose 1.4 percent and 0.3 percent, respectively.

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