Price watch

Updated 26 April 2026

Food inflation in Australia: what the data shows

Australian food prices rose 3-4% in the year to March 2026. Here is what got more expensive, what got cheaper, and what you can do about it.

The headline: inflation is slowing but prices stayed high

The good news: food inflation is cooling. Food and non-alcoholic beverages CPI rose about 3-4% in the 12 months to March 2026, down from the double-digit increases we saw in 2022-2023.

The bad news: prices haven't fallen back to where they were. A $200 weekly shop in 2021 now costs $240-260. Those 2022-2023 price increases are permanent. You're paying the new price, not the old one with a 3% bump on top.

What got more expensive

Fruit and vegetables: Weather events (droughts, floods, hail) have pushed fresh produce prices up. This is seasonal and supply-driven, so you'll see variation throughout the year.

Dairy: Global supply issues kept milk, cheese, and butter climbing. This is partly linked to input costs (feed for cows) that haven't fallen back to 2021 levels.

Meat: Beef, chicken, and lamb all rose on the back of higher feed costs. Like dairy, these costs didn't reverse when feed prices moderated.

Chocolate and cocoa products: The global cocoa shortage drove prices up 30-50% in 2024-2025. That pain is on the shelf now and hasn't eased.

What got cheaper or stabilised

Eggs: Down from the 2023 peaks when avian flu hit. Still not at 2021 prices, but trending down.

Bread: Wheat prices stabilised, so bakery and bread sections stopped climbing.

Cooking oil: Back from the 2022 highs. Sunflower and canola oil are reasonably stable now.

Tinned goods: Mostly holding steady. Inflation here is modest.

Why prices don't come down

This is the question everyone asks: if input costs fell, why didn't prices drop?

Retailers raise prices quickly when costs go up. But they rarely lower them when costs fall. The ACCC's 2025 Supermarkets Inquiry found that profit margins at the two major supermarkets increased during the period of elevated food inflation. In other words: they didn't pass all the cost reductions back to you.

This is how retail pricing works globally, not just in Australia. But when it happens at scale across two major chains holding 60-65% of the market, it affects your budget significantly.

The new price gouging legislation

From 1 July 2026, new laws come into effect designed to prevent retailers from raising prices excessively during supply disruptions. The legislation targets sudden, sharp increases during emergency situations (natural disasters, supply chain shocks). It won't roll back existing price levels, but it's meant to stop retailers from treating crises as pricing opportunities.

What you can do now

Track prices over time: Pinch shows 52 weeks of price history for thousands of products. When you see a product on sale, compare it against the 12-month average. Sometimes "on sale" is just back to the normal price.

Switch to own-brand: Home brand products are typically 30-50% cheaper than branded equivalents. Quality is usually identical, especially for staples like flour, sugar, tinned tomatoes, and oil.

Shop ALDI for staples: Milk, eggs, bread, cheese, tinned goods, and frozen vegetables are consistently cheaper at ALDI than the big two. Their range is smaller, but for essentials it's worth a second trip.

Buy seasonal produce: Fruit and vegetables are cheapest when they're in season locally. Strawberries in winter, apples in autumn, mangoes in summer. Out-of-season means airfreight or cold storage, both of which add cost.

Reduce waste: Food waste is money in the bin. Plan meals, check what you have before shopping, and use the vegetables that are about to go soft.