Even as inflation has slowed significantly from its recent highs, Americans continue to feel the squeeze at the supermarket, with food prices climbing 33% over the past seven years—the steepest increase over such a period in roughly half a century, according to a report by the New York Post.

Although the annual inflation rate eased to 3.5% in June after reaching 4.2% in May, grocery bills remain stubbornly high. One striking example is ground beef, which sold for an average of $6.82 per pound in June—a 79% jump compared to 2019, according to Bureau of Labor Statistics data cited by the Post.

Scott D. Martin, a partner at Kingsview Wealth Management, said consumers have gradually come to accept today’s elevated grocery prices as the new reality because they have remained high for so long.

“While inflation has cooled from its peak, grocery prices have not returned to where consumers remember them,” Martin said. “Food prices have effectively reset to a permanently higher level after years of supply chain disruptions, labor shortages, transportation costs, and broad inflationary pressures.”

Government data reviewed by the Post shows just how dramatically the trend has changed. Between 2012 and 2019, food prices rose only 6.4% in total over seven years. After the pandemic began in early 2020, however, grocery costs accelerated sharply.

Food prices surged approximately 21% between January 2021 and January 2023 and have climbed nearly another 10% in the years since.

Douglas Holtz-Eakin, president of the American Action Forum, said several long-term factors have kept grocery prices elevated, including reduced cattle inventories and the global disruption caused by Russia’s invasion of Ukraine.

“Grocery prices have gone up especially in 2021, but they have stayed high due to cattle disease and bad growing conditions,” he said. “The war in Ukraine hurt as well because it’s essentially the grain basket of the world.”

The impact has been so significant that many Americans have fundamentally changed the way they shop, seeking every possible opportunity to stretch their grocery budgets.

“Households are increasingly purchasing private-label brands, comparing prices across multiple retailers, buying in bulk when discounts are available, and cutting back on discretionary food purchases,” Martin said. “Even higher-income consumers have become far more price-conscious because groceries are one of the most visible household expenses.”

Martin cautioned that consumers should not expect meaningful relief anytime soon, pointing to the added pressure of tariffs along with rising transportation and energy expenses.

According to the U.S. Department of Agriculture’s latest Food Price Outlook, cited by the New York Post, overall food prices are projected to increase another 3.1% in 2026, followed by an additional 3.1% rise in 2027.

{Matzav.com}