Markets have another idea
President Trump ran on a ‘day-one’ plan to lower grocery prices. Good luck with that.
Here is what producers and markets expect in 2025, not including potential tariff war-related effects. Suffice to say – they are not expecting lower prices.
On Friday “the University of Michigan consumer survey showed that respondents expect inflation a year from now to be 4.3%, a 1 percentage point jump from January and the highest since November 2023.Worries over inflation dovetailed with lower optimism overall, as the headline index fell to 67.8, a one-month drop of 4.6% and an 11.8% move lower from the same month a year ago,” CNBC reported.
Even without consumer sentiment, here is what the market expects in 2025 for the price of goods you fill your shopping cart with.
Cattle industry outlook: Beef prices continued their upward trend in 2024, averaging $8.01/lb., the second-highest demand level in history. While demand may ease slightly in 2025, retail prices are still expected to rise to an average of $8.25/lb.
Coffee: This week Arabica coffee futures continued to soar, breaching $4 per pound, a new record high since the 1970s, driven by speculative buying and persistent supply concerns.The price is up almost 60% just since Trump was elected. Arabica prices have been supported by an anticipated sharp output decline in Brazil, the world’s top producer, following an extended dry spell in 2024 that impacted the latest harvest.Info from Trading Economics.
Here is a one year chart of coffee prices.
This week corn futures rose toward $4.90 per bushel, approaching their highest level in over a year of $497 seen January 29th, driven by tight global supply and strong export figures. Corn is a key ingredient in many food products, including tortillas, breakfast cereals, snacks, and beverages, including alcoholic beverages like vodka, bourbon, whiskey, and beer , to produce ethanol, a renewable biofuel that is blended with gasoline and importantly the primary energy ingredient in livestock feed affecting everything from milk,egg and meat prices.
Milk prices have increased 1.60 USD/CWT or 8.55% since the beginning of 2025, according to trading on a contract for difference (CFD) that tracks the benchmark market for this commodity. Today at over $20 per cwt, prices were down around $16 last spring.
Egg prices are at an all time high in 2025 and expected to go higher as bird flu has wiped out millions of hens and cut the US egg supply.Egg prices are predicted to increase 20.3 percent in 2025 says USDA.
Lean Hogs increased 5.75 USd/Lb or 7.07% ( 87 per pound) since the beginning of 2025. Trading Economics expects hogs to sell for $93.06 in 12 months time.
Salmon prices are heading higher in 2025. When Trump was elected Nov 6 salmon prices were at $78per kg but now they are just under $100 and expected to go to $138 in a year’s time. Prices are higher because the world is running out of wild salmon due to overfishing. There are a limited number of fish in the sea.
Tariff impacts
So what happens if tariffs with Canada and Mexico move forward?
One new report says “Avocados. Baked goods. Canola oil. Beer and tequila.Those are just a few items Americans can expect to cost more because of proposed threatened tariffs on goods coming into the U.S. from Canada and Mexico. After campaign promises to lower grocery prices for Americans who have seen more than a 20% rate of increase since early 2020, the pending tariffs put that vow in jeopardy. These tariffs came with a caveat from President Trump stating that Americans will feel “some pain.” A significant amount of fresh agricultural imports, meats, and other processed foods to the U.S. come from Canada and Mexico.”
Gas prices How about the other hot button issue of the last campaign -oil and gas prices?
This week gasoline futures rose toward $2.10 per gallon (wholesale) in February, about 10 cents higher than a month ago, tracking higher oil prices and expectations of tighter global supply. The US escalated sanctions on Iran earlier in the week, potentially restricting its oil flows, while Saudi Aramco sharply raised March crude prices (the guys that Trump asked to lower them) driven by rising demand from China and India, as well as supply disruptions from Russia. Russia’s Federal Antimonopoly Service is expected to ban gasoline exports for at least a month to stabilize wholesale prices, adding further pressure on the oil market.What about” drill baby drill? Turns out we now have a domestic rig count that is 37 oil rigs lower than the industry had a year ago.