U.S. producer prices rose 0.3% in October, slowing sharply from September’s 1.4% jump. The annual rate went the other way: 6.5%, up from 6.3% in September and the highest since November 2022, according to AP reporting published by The Economic Times on the Labor Department’s Nov. 13 release. Source
The producer price index measures price changes before goods and services reach consumers. It isn’t a measure of supermarket checkout prices. SourceSource
Vegetables are delivering the less comforting news
Wholesale fresh and dry vegetable prices jumped 27% in October after a 31% increase in September, Axios reports. Those are prices paid to producers by distributors, grocery chains and other businesses, not percentage increases shoppers necessarily face at the register. Separately, wholesale food prices overall were up 1.7% from a year earlier, ending three consecutive months of annual declines. Source
Axios links the food-price pressure to several problems: unusually warm weather, crop disease and insect infestations have reduced California lettuce and other leafy-green harvests, while the Iran war has increased fertilizer and fuel costs. Source
According to Axios, a regional grocery chain told Federal Reserve officials that transporting a head of lettuce from California now costs more than buying the lettuce itself, citing high diesel prices. Quite a travel bill for a vegetable. Source
What’s already reaching the checkout
Retail grocery prices rose 0.4% in October, the biggest monthly increase in six months, Axios reports. Retail fresh vegetable prices increased 2%, including a nearly 8% rise for lettuce. Source
Comments