Shoppers Finally Seeing Relief as Grocery Prices Drop in Q2

Over the past year, grocery prices remained consistently above average until the beginning of Q2 2024 when we witnessed the first drop. Several categories experienced decreases of approximately 0.7%, notably meats, poultry, fish, and eggs, with eggs experiencing the most significant decrease at 7.3%. Additionally, fruits and vegetables saw a reduction of 0.8%. However, bakery and cereal products experienced a slight uptick in pricing, around 0.6%.

Despite these fluctuations, grocery retail sales showed a positive trend, with a 0.6% increase in April compared to the prior month (April $74.2 billion), and a total increase of 1.5% in the first four months of 2024 compared to 2023.

While some grocery categories saw declines, restaurant prices continued to rise by approximately 0.3%. Andy Harig, VP of Tax, Trade, Sustainability, and Policy Development at FMI – The Food Industry Association, shared encouraging news, stating that food price inflation hasn’t significantly impacted consumers’ grocery shopping experiences. Matt Pavich, Senior Director of Strategy and Innovation at Revionics, echoed this sentiment, highlighting the stability and promising outlook of the retail market. He noted that not only did food inflation fail to materialize, but categories affected by avian flu, such as eggs and poultry, saw substantial pricing decreases. Several other categories, including apples, citrus fruit, peanut butter, and coffee, are now less expensive than they were a year ago. This stability benefits both retailers and consumers, allowing for clearer budgets and reduced operating costs.

However, grocers should remain vigilant despite these positive trends, as consumers continue to seek value brands, deals, and everyday low prices.