Dive Brief:
- Food-at-home prices are predicted to rise 2.5% in 2026, though the pace of growth will remain below the 20-year average, according to a forecast the USDA’s Economic Research Service released on Wednesday.
- Prices are projected to increase faster for sugar and sweets, beef and veal, and non-alcoholic beverages than for other food-at-home categories among the 15 the agency examined for its Food Price Outlook. Only eggs are predicted to see prices decline this year.
- The forecast follows the government’s report that the annual rate of grocery inflation eased to 2.1% in January after rising during the previous month.
Dive Insight:
The USDA’s predictions indicate that while grocery prices will rise overall in 2026, the rate of increase will be below the 2.6% average recorded over the past two decades.
The agency forecasted that prices for seven categories of food it looked at for the Food Price Outlook — which is based on Consumer Price Index and Producer Price Index data — will increase faster than their historical average this year. Prices for seven other categories will rise at a lower-than-average rate, the USDA predicted.
Egg prices, meanwhile, are poised to drop by 27.4% this year, according to the report.
The categories where the USDA expects to see prices rise more quickly than the historical average include beef and veal. The agency predicted that prices for those types of meat will go up 5.5% in 2026 — a level that would still be much lower than the 15% annual rate of inflation that beef and veal recorded in December 2025.
Prices for sugar and sweets, which have been going up more rapidly than overall food-at-home inflation, are likely to rise 6.7% this year, the USDA predicted. That figure will also outpace the 20-year average for the category.
Non-alcoholic beverage prices are likely to rise 5.2% in 2026, above the 20-year average for the category, driven in part by coffee prices.
Categories that will see prices rise more slowly this year include fresh vegetables, which will post an increase of 1.4%, the USDA predicted. Prices for fresh fruits will rise by a fraction of a percentage point, also below their historical average.
While food-at-home prices are in a position to rise more slowly than their historical average rate this year, costs for eating out are likely to increase more rapidly, the USDA said. The agency predicted that food-away-from-home prices will rise 3.7% in 2026, above the 3.5% average rate of increase they have posted during the last two decades.
