Consumer meat prices rose by a double-digit percentage again in June, with beef leading a broader rise in grocery prices during the month.
The meat, poultry, fish and eggs portion of the U.S. Consumer Price Index, or CPI, rose 12.8% year-over-year during the month, driven by higher prices for beef, data from the Bureau of Labor Statistics released July 14 showed. That far outpaced the increases in other product categories, including a 5.1% increase in dairy and related products as well as a 2.3% advance in the price of fruits and vegetables.
Overall, the CPI's food at home index, which represents prices for all food sold in a retail setting, rose 5.6% in June. The final-demand food index of the Producer Price Index, or PPI, rose at a slower 0.8% clip.
Grocery industry analysts use the difference between the two metrics to judge the state of grocers' margins. In June, the difference was positive by 4.8 percentage points, indicating that grocers' margins likely expanded. A negative difference would suggest that grocers' margins contracted during the month.
Retail meat prices have risen in recent months as U.S. meat-processing plants reopened after being closed by outbreaks of COVID-19 among workers. Customers' purchasing behavior is also still in flux: While retailers in many parts of the country have relaxed limits on the number of products, including fresh meat, that customers can buy at a time, some, like Texas-based chain HEB Grocery, reinstated them in early July, fearing another round of stocking up by consumers as coronavirus cases in certain Southern states skyrocketed.
Notable deals during the month to July 14 included PepsiCo Inc.'s $9.02 million purchase of a minority stake in U.K.-based Rude Health Foods Ltd., which makes natural breakfast cereals and plant-based milks. PepsiCo's ownership, closed June 12, represents about 10% of the company, according to Market Intelligence.
The month also included a pair of deals related to Nestlé SA's bottled water portfolio. The Swiss consumer-goods maker sold its Pure Life brand operations in Canada to Ice River Springs, a family-owned company. Terms of the deal, announced July 2, were not disclosed. In Italy, Nestlé-owned Sanpellegrino SpA on June 18 sold its Nestlé Vera srl to Acqua Vera S.p.A. The terms of the deal were not disclosed.
Privately held Mars Inc. sold its Sustainable Agrico LLC business, which includes its Seeds of Change grains brand, to Plantation Products LLC for an undisclosed amount June 17.
