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Food Inflation Down, Price Spikes Loom

Compared to February, grocery prices were down 0.2 percent in March signaling the first price decrease since September 2020, reports Yahoo Finance. However, some food items are likely to spike in the coming months.

One culprit for impending price increases is the recent flooding in California. Danny Koolhaas, director of agricultural services at Wells Fargo warns that common produce will get more expensive. Salinas Valley, which produces almost 80 percent of “all our table veggies” has been affected by floods, with 10 percent of the land still hampered by water. This has also delayed planting for next season’s veggies.

"You just have to find the deal where can find them, but there are going to be some items that are going to go up this year,” he said.

The floods are likely to have a negative butterfly effect across multiple food sectors, including tree nuts like almonds and pistachios.

“The weather that we had in February has significantly decreased the amount of hours that are required for these trees to pollinate with bee activity," he said. "So there is fear of a very small crop coming off a smaller crop than we had last year already…prices will definitely increase as a result of this tighter supply.” Full Story

Related: California Floods to Affect Food Prices; Digital Grocery Sales Down