JPMorgan: Forget Food Price Inflation, Retailers Still Aren't Passing It On To Consumers Yet

While China and broader Asia grapple with rising food costs, the U.S. seems safe, for now.

The latest report on the supermarket space from JPMorgan shows a modest rise in some prices from September to November, but substantial drops in costs in certain categories too.


Photo: JPMorgan

What’s noticeable is, first, the strong cuts Wal-Mart has been doing across the board. But overall, prices haven’t risen much and, in the produce category, have actually declined. Safeway is a noticeable exception.

From JPMorgan (emphasis ours):

We observed the following at the traditional grocers: (1) evidence of food inflation is apparent, but not all retailers are passing along 100% of the cost increase to customers. Moreover, the pass through trend is not consistent across categories or retailers and (2) promotional activity has continued, but looks more in-line with normalized levels.

So, food price inflation may be out there, but it isn’t hitting consumers just yet.

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