PALM SPRINGS, CALIF. — Many factors are at play when food prices go up, even as grocery store margins stay low, Mark Baum, senior vice president for industry relations and chief collaboration officer at FMI — The Food Industry Association, said at the opening session Feb. 24 at the International Sweetener Colloquium. He compared profit margins for food retailers at 1.6% in 2023 against those of restaurants at 10.7% and of banks at 29.6%.     

“The battle over food inflation continues in 2025,” Baum said.

“Inflation goes up like a rocket and down like a feather,” although he noted that food inflation was stabilizing as consumers try to stretch their food dollars. The average weekly grocery spend per household was $114 in 2019, jumped to $142 in 2021 and $164 in 2023 before inching up to $165 in 2024, he said.

But that may be negated by tariffs that were announced on the United States’ three largest trading partners — Mexico, Canada and China — on March 4, with retaliatory tariffs almost immediately following from Canada and China, the latter focusing on agricultural products. 

“Tariffs will hit food and agriculture significantly, countries will retaliate,” Baum said. “It will cause food inflation.”

He encouraged Colloquium attendees to find alternatives from countries without tariffs, if possible, and to differential themselves from other retailers and suppliers with the goal of providing shoppers with the best possible experience.

While Americans “got used” to low food prices, he noted that food-at-home inflation remains below all CPI data. Restaurants and food away from home have far more impact than grocery stores on food inflation.

Grocery shoppers’ top three concerns in 2025 were: increased tariffs on imported food; decreased availability of crop due to weather; and food transportation costs, Baum said, citing a recent survey. Major concerns included: avian influenza; outbreaks of food-borne illnesses at food stores; ongoing wars in Ukraine and the Middle East; and decreased availability of low-wage agricultural workers.