1991 Rise in Retail Food Prices Was the Smallest Since 1985

VVith lower farm prices for some commodities and the downturn in the general economy, retail food prices rose in 1991 by the smallest amount since 1985. As measured by the consumer price index (CPI), food prices rose 2.9 percent in 1991, compared with 5.8 percent in both 1989 and 1990 (table 1). Prices for food sold in supermarkets and grocery stores rose more slowly than at eating places, reversing the trend during the past 4 years. The CPI for food sold in supermarkets and grocery stores (food for at-home consumption) rose 2.6 percent in 1991. The CPI for food in restaurants and fast food establishments (food away from home) rose 3.4 percent, the smallest increase since 1965. Both components rose more slowly than the 4.2-percent increase in the CPI for all goods and services. Farm prices were lower due to larger supplies of red meats, poultry, dairy products, and orange juice. A sluggish economy dampened rises in processing and distribution costs. On the demand side, a reduction in disposable personal income (adjusted for inflation) squeezed consumers' budgets and their expenditures for foo