by Martin Armstrong
Armstrong Economics
Our models do not indicate that food inflation will ease in 2025. In fact, I have repeatedly warned that people may want to stockpile food for the next two years as there will be weather events and supply chain shortages. Our model warns that we may see another severe drought, probably between 2025 to 2027, in both the US and Canada. The drought conditions are already beginning, and this is in line with our model, which warns it will expand into the 2025-2027 period.
Walmart CEO Doug McMillon announced last week that he expects persistent high prices at the grocery store. “I don’t know what the whole year is going to look like. I hope and I think it could be better as these commodities adjust — some of them,” he said per GroceryDrive. According to McMillon, he was “disappointed” at where food inflation was currently and cited that eggs and dairy were the main problems.
Food prices shot up during the pandemic and never fully recovered. Then the was in Ukraine hurt Europe’s food supply in a major way. In America, the Food Industry Association conducted a study that revealed food inflation in America rose 25% since the pandemic, and recently rose 1.1% on a monthly basis in November.