The US Department of Agriculture has cut its 2026 forecast for food-at-home inflation to 2.4%, giving grocery retailers a slightly softer price outlook heading into the final quarter of the year.

The September 2026 Food Price Outlook, released on 25 September, also puts all-food inflation at 2.9% and food-away-from-home inflation at 3.5%. That keeps restaurant price growth above grocery inflation, while the supermarket picture remains highly uneven by category.

At a Glance

  • Food at home: forecast to rise 2.4% in 2026.
  • All food: forecast to rise 2.9%.
  • Food away from home: forecast to rise 3.5%.
  • Beef and veal: forecast up 9.4%.
  • Sugar and sweets: forecast up 6.6%.
  • Fresh vegetables: forecast up 5.7%.
  • Non-alcoholic beverages: forecast up 4.2%.
  • Eggs: forecast down 29.4% across 2026.

The revision follows August CPI data showing US food-at-home prices 2.2% higher than a year earlier and unchanged month on month. GTN covered that release separately in its August US grocery inflation report.

Beef remains the biggest pressure point

Beef and veal continue to stand out in the USDA outlook, with prices forecast to rise 9.4% this year. For supermarket meat buyers, that keeps pressure on retail price architecture, promotional planning and sourcing strategy even as the broader grocery inflation forecast edges lower.

The gap between headline grocery inflation and individual categories matters commercially. A 2.4% average does not mean retailers are seeing uniform cost conditions across the store. Protein-heavy baskets can still carry a much stronger inflation burden than pantry or dairy-led baskets.

Fresh vegetables and sweets stay elevated

Fresh vegetables are forecast to rise 5.7% in 2026, while sugar and sweets are expected to increase 6.6%. Non-alcoholic beverages are forecast 4.2% higher.

Those figures keep cost pressure concentrated in several high-frequency grocery categories. For buyers, the practical issue is less the national average than how much inflation is sitting in categories that drive weekly basket perception and promotional traffic.

Egg prices move in the opposite direction

Eggs remain the sharpest falling category in the USDA forecast, with prices expected to decline 29.4% across 2026.

That reversal creates a very different trading environment from the one retailers faced during earlier periods of severe egg-price inflation. Lower egg costs can give supermarkets more room for sharper shelf pricing, promotional activity and value messaging in a category closely watched by households.

What the forecast means for supermarkets

The lower food-at-home forecast is supportive for retailers, but it does not remove margin pressure. Grocery chains still have to manage a mix of high-inflation and deflationary categories while keeping overall basket prices competitive.

That makes category-level pricing more important than broad-based changes. Retailers may have greater scope to use falling-cost lines such as eggs as visible value markers, while managing margin exposure more carefully in beef, vegetables, sweets and beverages.

The continued gap between grocery and foodservice inflation is also significant. With food-away-from-home prices forecast to rise faster than food-at-home prices, supermarkets retain a relative value advantage for households comparing eating at home with restaurant and takeaway spending.

What it means for FMCG and private label

For branded suppliers and private-label manufacturers, a softer grocery inflation forecast could make it harder to justify broad price increases without clear commodity, labour, packaging or logistics evidence.

Retail buyers are likely to remain focused on cost transparency, especially in categories where USDA expects inflation to moderate. At the same time, suppliers exposed to beef, produce, sugar or beverage inputs may still face stronger cost conversations than the headline 2.4% rate suggests.

Private label could remain particularly important where shoppers continue to manage total basket spend. Even with slower inflation, absolute grocery prices remain above pre-inflation levels, so retailers still have an incentive to use own-label tiers to defend value perception and protect customer loyalty.

What happens next

USDA will continue to update the Food Price Outlook as new CPI and producer-price data become available. Its early 2027 forecast currently points to food-at-home inflation of 1.8%, although the agency’s forecast range remains wide and category-level risks can move quickly.

For supermarket buyers, the key signal from the September update is that overall grocery inflation is easing, but the pricing environment remains fragmented. The next major decisions will continue to be made aisle by aisle rather than on the headline rate alone.

Editor’s Note: This report is based on the USDA Economic Research Service Food Price Outlook updated on 25 September 2026, incorporating the latest available US food-price data. GTN’s analysis focuses on food-at-home, supermarket categories and foodservice comparisons relevant to grocery retailers, buyers and FMCG suppliers.