How the Russia-Ukraine war impacts food prices

Business News | 19 Apr |

While the U.S. is not directly involved in the Russia-Ukraine war, Americans are seeing an impact at home. The prices of commodities and products in the U.S., and worldwide, have increased above the norm. While spending on some commodities such as gasoline can be greatly minimized or avoided, depending on lifestyle, food spending is unavoidable. Consumers across the nation are experiencing higher prices on wheat and corn-based products, among other food prices. And farmers are also experiencing higher prices for basic trade tools like fertilizer, which is needed to grow crops for consumers.

In this study, we sought to uncover the trends in rising consumer food prices nationally and across the four primary U.S. regions (Northeast, Midwest, West and South). Below we discuss both national price increases by food type as well as the regions where food prices are rising most quickly. For details on our data sources and how we put all the information together to create our final rankings, read the Data and Methodology section below.

Key Findings

Food prices for cereal and bakery products have increased the most since February 2022. One-month price increases for these products were highest in the Midwest region (2.8%) and lowest in the Northeast region (0.6%). These products rely on wheat, which has seen major price increases globally since Russia’s invasion of Ukraine.

Over the past year, prices for meats, poultry, fish and egg products have skyrocketed. Bureau of Labor Statistics (BLS) data shows that prices for meats, poultry, fish and egg products rose by close to 14% from March 2021 to March 2022. This is significantly higher than the one-year price change across all food, 8.8%.

Midwesterners are seeing the highest recent food price hikes. From February 2022 to March 2022, cereal and bakery products neared a 3% increase in the Midwest while no other region broke a 2% price increase. Similarly for dairy products, the Midwest region saw a one-month price increase of 2.4%, while the remaining regions’ increases were below 1.6%.

National Price Increases by Type of Food

Overall food prices rose 1.0% between February 2022 and March 2022. While that figure may seem small, it equates to an annualized rate of 12.3%. For specific food products, cereals and bakery products were hardest hit in terms of price increases (1.8%) while fruits and vegetables had the lowest percentage increase (1.1%).

When compared with last year (March 2021), U.S. food prices have increased by 8.8%. For this one-year time period, meat, poultry, fish and egg products were hit hardest with an increase of 13.7%. Dairy products had the lowest percent increase of 7.0%. The table below shows one-month and one-year national price increases by food category.

Regional Food Price Increases, Ranked

1. Midwest

From February 2022 to March 2022, food prices in the Midwest rose by 1.4%, the most across all four regions. This figure is 40% higher than the national average (1.0%). Cereal and bakery products saw the largest increase of 2.8% while prices for meat, poultry, fish and eggs along with dairy both rose by 1.2%.

If food prices in the Midwest continue to increase at the same rate, they could hit an annualized inflation rate of 18.2%. This is significantly higher than the Midwest's one-year change in food prices from March 2021 to March 2022 (10.3%).

2. South

The South has the second-highest one-month food price increase, at 1.1%. Cereals and bakery products are 2.0% more expensive on average at the end of March 2022 compared to one month previously. All other food products analyzed increased between 1% and 2% over the month period.

3. West 

In the Western region of the U.S., food prices rose by 0.9% from February 2022 to March 2022. Across food types, only meats, poultry, fish and egg prices saw an increase exceeding 2%. Cereals and bakery products are nearing 2% while the other food categories remain below a 1% increase. The Western region has the lowest one-month price increases for dairy products (0.3%) and fruits and vegetables (0.6%).

4. Northeast

From February 2022 to March 2022, food prices increased by only 0.7% in the Northeast. Across food categories, no food type saw an increase exceeding 1%. The highest percentage increase occurred for fruits and vegetables (0.9%). This is followed by cereals and bakery products (0.6%), dairy products (0.5%) and meats, poultry, fish and eggs (0.2%).

The Northeast also ranks lowest across all four regions for its one-year change in food prices (7.6%). This figure is 1.2 percentage points lower than the national average.

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