Monster month of July for the meat department (2024)

The June and July consumer media headlines reflected the ongoing pressure on restaurants. Tight finances and mounting job market pressure have led to lower consumer confidence and more trips to the grocery store. Consumers are making more home-prepared meals across all occasions, but also integrate grocery deli-prepared foods and meals more often as they balance money against time, nutrition, mood, sustainability and more.

In addition to the widely reported bankruptcy filings by Red Lobster, Buca di Beppo, Rubio’s, World of Beer and several small restaurant chains filed for Chapter 11 bankruptcy in the past few months. Other restaurant chains, including TGI Friday’s, Hooters and Arby’s closed multiple underperforming locations. In response to consumers’ financial woes, many restaurants are turning to value, such as McDonald’s $5 meal deal.
For restaurants and grocery stores alike, the changes are predominantly driven by lower-income consumers. According to the Circana survey, 63% of households with annual incomes of up to $25,000 bought restaurant food at least once in June compared to 85% of households making at least $100,000.
Restaurant price increases continued to outpace food-at-home inflation, at +4.1% versus +1.1%, according to the June Bureau of Labor Statistics (the latest available at the time of publication).
Lower-income households were also more likely to implement money-saving measures when shopping for groceries, at 84% versus 76% of upper-income households. Lower-income households especially over index for buying less and sticking to the budget, switching to store brands and shopping at value retailers. All income levels and ages are focused on sales promotions and coupons.
A new report by the U.S. Department of Agriculture predicts that food prices will continue to decelerate. Prices for all food are now predicted to increase 2.2% over 2024, with food-at-home prices projected to go up just 1.0%. The 2025 forecast expects a 2.0% price increase for total food, with a below-average anticipated increase of 0.7% for food-at-home prices.

Inflation insights

In July 2024 (the four weeks ending 7/28/2024), the price per unit across all foods and beverages in the Circana MULO+ universe stood at $4.22, an increase of 1.5% versus July 2023. This is also a slight uptick from the 1.3% price increase seen in June. Prices in the fresh perimeter were up 2.3% year-over-year in July. This marks the first time in quite a while that fresh item inflation was higher than that in the center of the store that averaged an increase of 0.9% year-on-year. The average price of $4.22 is 34.8% higher than the 2019, pre-pandemic average of $3.13.

The average price per pound in the meat department across all cuts and kinds, both fixed and random weight, stood at $4.71 in July 2024, up 2.3% from year-on-year. The average processed meat price stayed above $5, up 1.4% versus prior-year levels.

July brought a mix of price movements. Pork, beef and bacon, in particular, experienced increases in price. This is a reversal for bacon that had been experiencing deflation throughout much of 2023 and the early part of 2024. Lamb, turkey, packaged lunchmeat, smoked ham and processed chicken experienced substantial price declines.

Meat sales