2025 Trend Forecast: Is Grocery Inflation Here to Stay?

Nosh Staff Jan. 16, 2025 at 12:49 PM

At the start of what is sure to be another eventful year in CPG, BevNET & Nosh reached out to individuals from across the industry to hear their thoughts on what’s making them optimistic about the future, what’s keeping them up at night, their general impressions for the new year and how they plan on tackling (or avoiding) some of the biggest questions on their plate at the start of 2025. In some cases, responses have been edited for clarity and space.

See other articles from our 2025 Trend Forecast series:

Though inflation has decelerated in recent months, it’s doubtful that still-elevated grocery prices will come down in the near future, despite the campaign promises of various politicians. As pressures persist, price-conscious, value-seeking shoppers are expected to continue leaning on store brands, as evidenced by last year’s influx of private label launches, including Walmart’s bettergoods, CVS’ Well Market, and Amazon Saver. Promotions, discounts, and loyalty programs will also be key tools for retailers seeking to deliver value to cash-strapped consumers.

But if the consensus among industry experts is that grocery prices will stay high, opinions about potential further knock-on effects from lingering inflation are diverse. Will private label thrive? Will we see more shrinkflation, or an increase in factory farming? We asked, they answered.

Do you anticipate that grocery prices will be lower in January 2026 than they are at the start of 2025? Why or why not?

“We are anticipating that the grocery prices will remain about the same, driven by the fact that inflation will continue to be stubborn and not move very much.” – YuChiang Cheng, CEO, Hero Bread

“The increase in food prices over the past several years was primarily driven by three factors: cost and availability of raw materials, cost and availability of labor, and financial pressures from stakeholders. While raw materials have largely stabilized, and in many cases returned to at or near pre-2020 levels, hourly wages aren’t going to go down. It’d be very difficult to roll back pay that was raised to support frontline workers in manufacturing and stores during the pandemic. Similarly, shareholders and investors have benefited from the financial performance of food brands the past several years, which they’ll want to maintain. Add to these the threat of increased cost of imported goods from the upcoming presidential administration, and there’s little chance we’ll see a reduction in the average family’s grocery bill any time soon, if ever. – Rifle Hughes, Co-Founder, Integral CPG, Inc.

“Shoppers are likely to remain price-conscious and value-driven. We’ve already lowered our prices on more than 1,000 items in 2024 to meet our members where they’re at, and we will continue to do so as we make good on our mission of making healthy and sustainable living easy and affordable for all.” – Thuy Nguyen, Category Manager, Thrive Market

“I have no reason to expect lower prices in 2026 than 2025. With few exceptions, prices only rise outside of a deflationary economy. With proposed tariffs, deportation and lenient business oversight, there is certainly momentum toward higher inflation and prices.”– Scott Marcus, CEO, Blue Zones Kitchen

“If prices stabilize or decrease it will be an artificial deflation due to smaller package size [shrinkflation], not because of lower food costs or retailers benevolently leaving margin dollars on the table”. – Rob Leichman, Founder, The Lyric Group

“I believe retail pricing has been stabilizing through 2024, and in this increasingly competitive CPG market, average price will be lower by January 2026.” – Chris Pruneda, CEO & Co-founder, Matador Energy

“The high labor cost and lack of workers will likely mean grocery prices will continue to go up. We need to continue to find more efficiencies through reducing food waste, and how we educate ourselves about the story of food. This is one of the most crucial environmental efforts that we all need to be conscious of over the next few years in particular. Culturing habits that acknowledge the work that goes into our food all the way from seed to table means valuing our food more holistically, and this can be a great pleasure.” – Lonica Kufner, Founder, Clean Label Consulting

“If anything, inflationary pressures in food are either increasing already or set to increase based on action the new administration is proposing and appears ready to enact. Odds are very, very, high that grocery prices will end higher in Jan. ’26 if the rhetoric becomes policy – even if not the most extreme version of the rhetoric – despite everyone’s ‘desire to believe’ what was sold in the [presidential] election.” – John Foraker, Co-Founder/CEO, Once Upon a Farm

“Honestly, we don’t see grocery prices dropping significantly in the next year. Input costs are still high, supply chain challenges are ongoing, and consumers continue to demand higher-quality, functional, and sustainable products — all of which come at a premium. That said, we believe shoppers will focus more on value, and brands that deliver on health, convenience, and trust will come out ahead.” – Genevieve Gilbreath, Managing Partner, Springdale Ventures

“The inflated grocery prices are in direct correlation to the large growth in profits for retailers and distributors, unfortunately at the cost of the suppliers and consumers. That said, retailers need innovation to keep consumers, and that will have to come from the same emerging/middle market brands that have been suffering.” – Steve Gaither, EVP of Growth and Strategy, 1o8 Agency

“All signs point to Trumpflation now that Bidenomics has run its course. Trump will reward voters who supported him for criticizing high prices by implementing policies that will raise prices even more. And the basic structural issues that I have documented for the last four years that enabled inflation all remain unchanged or worse: consolidation at retail, CPG, processing, commodities, seeds and agrochemicals, with companies leveraging market power to push prices above the rate of inflation under cover of public concerns about inflation, in order to keep squeezing higher profits, even as volumes decline. Sellers’ inflation will continue even as some retailers increase promotions, store brands and occasional price investments.” – Errol Schweizer, Grocery Retail and CPG Strategist, Author of “The Checkout”

“A rush to reduce grocery prices alongside producing as much food as possible in America may lead to more factory farming, less priority for natural and organic agriculture (soil for growing fruits and vegetables as well as land for animals), and an accelerated artificial ingredient pipeline. The math isn’t mathing for this new wave of food and drinks to be healthy or ethical.” – Amrit Richmond, founder of Indie CPG

“I’m not sure if inflation, the rate at which prices for goods and services increase over time, is the most critical metric to assess in regards to grocery prices remaining elevated. If inflation comes down it just means that the rate of price increases has slowed, but the actual costs of goods and services themselves remain elevated. I think interest rates and tariffs have a more direct impact on whether grocery prices will remain elevated or be lowered in the future.” – Sahra Nguyen, Founder/CEO, Nguyen Coffee Supply