JUNE CONSUMER FOOD PRICE INDEX INCREASES 0.2%

The Consumer Price Index fell a seasonally adjusted 0.2% in June the U.S. Labor Department said.

The food index rose 0.2%t, the smallest increase of the year, statistics indicated.
The index for food at home increased 0.2%, with major grocery store food groups mixed. The indexes for fruits and vegetables and for meats, poultry, fish, and eggs both declined, and while the other major grocery store food group indexes all increased, none rose more than 0.6%.

The index for food away from home increased 0.3%.

U.S. supermarket prices for fresh fruits and vegetables fell for the third consecutive month, led by declines in tomatoes and lettuce, as fresh produce inflation eased from a cost spike earlier this year stemming from harsh winter weather. Average nationwide retail fruit and vegetable prices during June fell 0.4% from May.
Fruit and vegetable prices have declined as production returned to normal levels after freezing weather earlier this year killed crops in Arizona, Florida and Mexico, leading to shortages of some products. Prices for lettuce and tomatoes have been among the largest decliners, tumbling 3.1% and 6.1% in June from May, according to CPI data.

Fruit and vegetable prices remain above last year’s levels, reflecting accelerating food inflation that’s pushing Americans’ grocery costs higher for meat, milk and many other items.

Fresh produce inflation in 2011 is on pace to increase 3.5% to 4.5%, the largest increase since 2008, according to a recent government forecast. Prices rose 0.6% last year.

During June, fresh vegetable prices were up 5.8% from the same month in 2010, the 16th consecutive year-over-year increase, according to the CPI report. Prices rose by an average of 6.1% during the first six months of this year.

Fresh fruit prices were up 1.8% in June, the sixth year-over-year increase in the past seven months.