The Reason For Food Cost Inflation

Food-cost inflation has been increasing at a 3.5 percent rate in the past year, and recent trending has spiked to upwards of 6 percent. Greater international demand for food products as well as environmental factors like flooding and droughts have driven this inflation surge. Meanwhile, spiking ethanol-related demand for corn has hurt the cost of animal feed, which in turn leads to even higher commodity product costs. If that’s not enough, rising fuel prices add to the cost of moving and storing those commodity food products. It’s a situation that affects all areas of the food chain in both retail and foodservice distribution. Your customers are feeling the same pinch at the grocery store. The bottom line: We are mired in a period of sustained, rising food cost inflation.