Food prices are the main topic right now as many people struggle to keep their food budget under control. It’s not that prices are still rising. Three years of inflation have pushed prices much higher than they were before the pandemic.
Two grocery chains have announced plans to cut prices. During a conference call to discuss quarterly earnings this week, Walmart CEO Doug McMillon said negotiations with suppliers had led to lower prices on grocery shelves, but he said prices should come down even further.
“The upward pressure is less, but there are still people talking about cost increases. We are aggressively fighting back against that because we believe prices need to come down,” McMillon said.
The Walmart CEO said there was one area of the grocery business where prices had remained “stubbornly high.” Prices on dry foods and processed foods had not gone down and some prices were still going up.
Are prices stabilizing?
In July’s ConsumerAffairs Datasembly Shopping Cart Index, which tracks the prices of 25 commonly purchased food items, prices for ketchup, mayonnaise and salted butter rose month-on-month and year-on-year, while prices for many other items fell or remained the same.
The Consumer Price Index (CPI) for July, released this week, also shows a mixed picture on food prices. The “food at home” index, which reflects food prices, rose 0.1% over the month. Three of the six major grocery store food group indexes rose over the month, while the other three indexes fell in July.
Prices for meat, poultry, fish and eggs rose 0.7% in July, while the egg index rose 5.5%. The fruit and vegetable index rose 0.8% during the month and the non-alcoholic beverage index rose 0.5%.
Kroger is also promising to do something about high grocery prices, but it comes with a big “if.” A company spokesperson told Bloomberg that the supermarket chain would cut its prices by $1 billion if its mega-merger with Albertson’s is approved.
The proposed merger is facing a number of antitrust lawsuits, including one from the state of Colorado that has put the deal on hold pending trial. The chain’s promise to lower grocery prices is intended to counter critics that the merger would reduce competition in the grocery industry and lead to higher prices.
Mark Huffmanreporter
Mark Huffman has been a consumer news reporter for ConsumerAffairs since 2004. He covers real estate, gas prices and the economy, and has covered negative option selling extensively. Previously, he was a reporter and editor for the Associated Press in Washington, DC, and a correspondent for Westwood One Radio Networks and Marketwatch.
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