Food prices in the US may be rising faster than the government forecast as companies including Coca-Cola Co., Safeway Inc. and Chipotle Mexican Grill Inc. pass higher commodity costs on to consumers.Rallies in meat, grain and dairy products since February may mean the increase in food costs will surpass the 3 to 4% that the US Department of Agriculture (USDA)predicts, said Christopher Hurt, an agricultural economist at Purdue University in West Lafayette, Indiana. The USDA left its forecast for this year’s gains unchanged and said 2012 prices will increase 2.5 to 3.5%.
Food inflation was “stronger than expected” at Pleasanton, California-based Safeway supermarkets, with prices rising 2 percent in the second quarter, Chairman and Chief Executive Officer Steven Burd said July 21 on a conference call with analysts.
Food and fuel increases have hurt demand, “and that’s particularly true for that segment of our shoppers that believe we’re still in a recession, which is the largest segment” of customers at Safeway, the fourth-largest US supermarket chain by sales, he said
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