WASHINGTON, DC – USDA expects food inflation to remain moderate overall in 2026, but consumers are still seeing uneven price movement across major categories. The Economic Research Service forecasts all food prices will rise 2.9% this year, close to the 20-year historical average of 3.0%.
Food-at-home prices are forecast to increase 2.4%, while food-away-from-home prices rise 3.5%. Through August, all food prices were up 2.7% from a year earlier, with grocery prices up 2.2% and restaurant prices up 3.4%.
The difference matters across agricultural markets because grocery and foodservice channels use different products, packaging and distribution systems. Higher restaurant inflation can also affect how consumers split food spending between home and away-from-home meals.
USDA’s outlook shows major differences inside the grocery basket. Beef and veal, fresh vegetables, sugar and sweets, and seafood are forecast to rise faster than overall food prices, while eggs decline sharply.
For 2027, USDA projects all food inflation at 2.0%, with grocery prices up 1.8% and food-away-from-home prices up 2.6%, although forecast ranges remain wide.
Farm-Level Takeaway: Overall food inflation is moderating, but wide differences between categories continue shaping demand across agricultural markets.