Elevated fuel costs could soon wear down food companies that have so far kept price increases contained, industry experts said at an FMI briefing.

Grocery inflation is poised to begin accelerating over the coming months, as elevated fuel costs start to wear down retailers and suppliers that — until now — have been able to keep a lid on price increases for many products, food industry experts said Thursday during a briefing hosted by FMI — The Food Industry Association.

Grocery inflation in August came in at an annual rate of 2.2%, down from 2.7% during each of the previous three months, according to the Bureau of Labor Statistics. But the sustained increase in oil prices brought on by the Iran war this year is putting enough pressure on the grocery industry that retail prices are unlikely to remain in check as the year progresses, said Ricky Volpe, professor of agribusiness at California Polytechnic State University.

“We have evidence that there have been some explicit efforts by food companies, retailers, manufacturers throughout 2026 to keep prices down [to] remain competitive [and] address customer sentiment,” Volpe said. “But I do not think that can last forever, and I will be surprised if we don't see food price inflation tick up somewhat for the last quarter of 2026.”

Volpe said he expects the rising pressure from fuel costs to push grocery inflation to an above-average rate for 2026. 7% for the year, he estimated.

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