USDA Trims Food Inflation Outlook for 2026 and 2027 Amidst Persistent Beef and Energy Cost Concerns
The U.S. Department of Agriculture (USDA) has revised its food price inflation forecasts downward for 2026 and 2027, indicating slightly slower increases in grocery and restaurant bills. The Economic Research Service (ERS) now projects all food prices to rise by 2.9% in 2026, a slight decrease from the 3.0% forecast in August, and 2.0% in 2027, down from 2.4%. Grocery prices are expected to increase by 2.4% in 2026 and 1.8% in 2027. Despite these overall reductions, certain categories, particularly beef and veal, are still anticipated to see significant price hikes due to tight supplies. Retail beef and veal prices are forecast to increase by 9.4% in 2026 and an additional 4.7% in 2027. Conversely, egg prices are projected to fall by 29.4% in 2026, offering some relief to consumers. The report also highlights the ongoing impact of elevated diesel costs, which are contributing to higher expenses across the agricultural supply chain, affecting transportation and refrigeration.