Consumers’ Appetites Grow
Consumer spending on food, both retail and foodservice, hit a record level in May of $133.3 billion according to the Daily Livestock Report (DLR). May’s monthly total was $8.4 billion greater than the previous record set in January 2020. Figure 4 shows retail and foodservice sales since 2017. The DLR reports May sales through foodservice were $67.3 billion, 71 percent higher than the previous year. Of course, last year’s sales were off drastically due to COVID. Still, foodservice sales in May were a record high at $67.3 billion. The DLR states higher traffic counts and price inflation contributed to the growth.
Somewhat surprising, sales of food through retail establishments have not fallen off like most observers expected post-COVID. Prior to COVID, retail sales were $58.4 billion. After spiking to $75 billion during the first stages of the pandemic, sales have settled at roughly $65 billion, still well above last year’s pre-COVID sales. Consumers are still making the trek to the grocery store, in addition to eating out more often. But, food inflation is also a factor. According to DLR, inflation for food consumed at home is 4.5 percent higher than pre-COVID levels.
Figure 4. Spending on Food: Retail & Foodservice (Million $)