OECD Food Inflation Holds Steady at 4.5% in July 2025, But Country Trends Diverge

Food inflation across the OECD remained broadly stable at 4.5% in July 2025, marking little change from the previous month. However, the stability in the overall figure masks significant variations among member countries, with some experiencing sharp increases while others saw declines or even deflation.

Türkiye Tops the List With Soaring Food Prices

Türkiye once again recorded the highest food inflation among OECD members, with prices rising 28% compared to July 2024. This dramatic surge reflects ongoing currency volatility, supply chain pressures, and structural challenges in the country’s economy. The figure stands far above the OECD average and highlights the persistent cost-of-living crisis for Turkish households.

Eastern Europe and Asia See Higher Inflation

Several countries in Eastern Europe and Asia also reported strong food price growth.

Estonia (9.1%), Japan (8.2%), and Slovenia (7.7%) were among the countries facing notable increases.

Other nations, including Latvia (6.9%) and Denmark (6.5%), also recorded inflation well above the OECD average.

These figures point to regional challenges such as higher import costs, energy price fluctuations, and weather-related disruptions affecting food supply.

Moderate but Persistent Inflation in Western Europe

Western European countries generally reported more moderate inflation rates, though food prices remain a source of concern for households.

The United Kingdom (4.9%), Ireland (4.7%), and Netherlands (4.7%) are close to the OECD average.

Larger economies like Germany (2.8%), France (1.8%), and Spain (2.7%) reported relatively subdued increases, indicating that inflationary pressures have eased compared to the peak levels of 2022–23.

Signs of Food Price Deflation

Interestingly, a few OECD members experienced outright declines in food prices. Switzerland (-0.6%) and Costa Rica (-0.1%) reported negative food inflation, suggesting stronger supply conditions and effective price stabilization policies.

United States and Canada Show Modest Increases

In North America, food inflation remained below the OECD average.

The United States (2.3%) and Canada (3.3%) posted relatively low increases, reflecting easing supply chain disruptions and better domestic production.

Mexico (2.6%) also reported moderate food inflation.

Why Food Inflation Matters

Food inflation is one of the most visible forms of price increase, directly impacting household budgets, especially in lower-income groups. While the OECD’s average of 4.5% indicates stabilization compared to the spikes seen in recent years, the persistence of elevated prices in several countries highlights the fragility of global food markets.

Key drivers of these trends include:

Currency fluctuations, which affect the cost of imports.

Energy prices, which influence transportation and fertilizer costs.

Climate conditions, with droughts, floods, and extreme weather disrupting supply chains.

Outlook for the Coming Months

With global commodity prices showing signs of easing and supply chains gradually stabilizing, food inflation across OECD economies may continue to moderate in the second half of 2025. However, geopolitical tensions, climate shocks, and economic uncertainty remain potential risks that could trigger renewed price volatility.

Conclusion

The OECD’s July 2025 figures show that while the average food inflation rate of 4.5% signals relative stability, the lived reality for households varies dramatically across countries. From Türkiye’s staggering 28% rise to Switzerland’s mild deflation, food inflation remains a deeply uneven challenge. Policymakers will need to strike a balance between managing short-term inflation pressures and addressing the structural issues driving food price instability.