US: Food inflation forecast rises
The US Department of Agriculture predicts food price increases in 2012
The United States Department for Agriculture (USDA) has lifted its forecast for food inflation in the US this year.
The USDA yesterday (25 October) predicted that food prices will increase 3.5-4.5% this year, up from a September estimate of between 3% and 4% for the year.
A USDA statement said: "Although food price inflation was relatively weak for most of 2009 and 2010, cost pressures on wholesale and retail food prices due to higher food commodity and energy prices, along with strengthening global food demand, have pushed inflation projections upward for 2011."
The figures are a steep rise on last year. Food prices increased 0.8% between 2009 and 2010, the lowest food inflation rate since 1962.
All food increased 0.4% from August to September 2011, increased 0.5% from July to August, and is now 4.7% above the September 2010 level, according to the figures.
The government agency forecasts that food price inflation is expected to "abate" in 2012 but will still be slightly above the historical average for the past two decades.
Price levels in 2012 will hinge significantly on several macro-economic factors such as weather conditions, fuel prices, and the value of the US dollar, it said.
One of the biggest prices rises was in eggs, which increased 6% in September and are now 11.1 percent above the September 2010 level.
For a detailed breakdown of food sectors log on at the USDA website.
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