Wholesale vegetable price spikes might not show up in your grocery bill — yet

The Bureau of Labor Statistics released the producer price index for February on Wednesday. The PPI measures inflation at the wholesale level, tracking the price producers receive for goods and services. Overall, PPI increased 0.7% in February, driven largely by an increase in the prices of services.

That said, on the goods side, BLS attributed more than 20% of the rise in goods prices to an almost 49% jump in vegetables, specifically.

Vegetable prices can be quite volatile, according to Joe Balagtas, director of the Center for Food Demand Analysis and Sustainability at Purdue. “Month-to-month moves on the order of 20% to 30% or more are not unusual.”

That’s one reason why he said it’s difficult to explain why veggie wholesale prices jumped —maybe big winter storms sweeping through the Southeast had something to do with it? “That affected tomato production, sweet corn production,” Balagtas said.

Labor shortages could’ve driven up costs for producers too, said Cornell agricultural economist Chris Barrett.

“Foreign-born populations in the United States, especially those who are undocumented workers, are under a little bit of pressure, and that creates a lot of pressure for growers to be able to recruit adequate skilled workers,” he said.

Barrett said that the U.S. imports a lot of vegetables, especially in February. “And that lets domestic producers ask for a little more, because the competing suppliers are having a tariff added on to their prices.”

Whatever the reason, higher producer prices don’t necessarily mean consumers will see higher prices immediately.

”In my kind of micropolitan, rural area of Pennsylvania, I haven't been seeing big increases at the grocery store,” said Amelia Finaret, a dietician and food economist at Allegheny College.

Producer prices are generally more volatile than consumer ones, she noted. “Final retailers and wholesalers, they really do try to buffer. They're not going to change prices at the grocery store unless they kind of know that the increase to their own costs is kind of permanent or long-term.”

Though Finaret said there are a lot of things that could lead to continued increases from further impacts of tariff, labor, and weather factors to the war in Iran “because of the increased price of diesel” — which, she pointed out, vegetable farmers need to drive their tractors.