Consumers are more optimistic on cooling food inflation, Purdue University finds

15-Aug-2024 - Last updated on 15-Aug-2024 at 13:42 GMT

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Consumers show increased optimism about inflation cooling as food security improves, with many shoppers reporting greater diet satisfaction and some turning to local food sources like farmer's markets and home gardens, according to a recent Purdue University report.

Each month, Purdue University's Center for Food Demand Analysis and Sustainability surveys 1,200 US consumers on their food-spending habits, their perspectives on health and food-policy issues, including inflation, and their overall satisfaction with their diet. The July report consists of results from a survey from July 15-18, 2024.

Overall, consumers' estimates on food inflation are closer to the actual government reported number on food inflation, according to the July results. An average of consumers' estimated food inflation over the past 12 months was 5.4% in July, down from 6% in June. Similarly, consumers expect food inflation to grow 3.2% in the next 12 months, a drop from June’s estimate of 3.6%. July’s results are the lowest since Purdue University started conducting these surveys.

Earlier this month, the U.S. Bureau of Labor Statistics shared that food prices rose 2.2% for the year ending June 2024, lower than the Consumer Price Index for all consumers, which rose 3% during the same time.

Food insecurity shows signs of improving

In the survey, consumers were asked to rate their diet satisfaction, using a 0-10 scale. Purdue then grouped responses into suffering, struggling and thriving for ratings between 0-4, 5-6 and 7-10, respectively.

Overall, 67% of consumers were classified as thriving, 21% struggling and 12% suffering, which is slightly better than January and April 2024 results but lower than July and October 2023 numbers, which were 73% and 68% of consumers thriving, respectively.

Additionally, household food insecurity has improved over the last month. Purdue University's food insecurity metric, based on six questions about foods purchased and eaten in the last 12 months, came in at 11.1%, about 5% lower than July 2023 numbers.

Consumers value farmers markets, as some grow food themselves

In the July results, Purdue University also surveyed consumers about their plans to shop at farmers markets and gardening habits.

Most consumers have access to a farmers markets near them, with 85% of those making $50,000 a year or more saying they have access to one, compared to 74% of consumers who get paid less than $50,000 a year. However, regardless of socio-economic status, 81% of all customers say they plan to shop for food at a farmers market this summer.

Consumers who shopped at farmers markets would mostly frequent them once a week, with 32% of consumers making over $100,000 a year, 34% making between $50,000-100,000, and 33% of those making $50,000 or less claiming so, the report found. Consumers making over $100,000 were the most likely to shop frequently at farmers markets out of any socio-economic demographic, with 15% claiming they go more than once a week, compared to 2% of those who make less than $50,000 saying the same.

Similarly, Purdue University found a correlation between those who make more money and those who have the means to grow food. More than a third (36%) of consumers who make more than $100,000 a year say they currently grow some of their food, compared to 22% of those who make $50,000 or less.