US July Lettuce Prices Fall 16.4% in Record Monthly Drop Amid Cyclospora Outbreak

Lettuce prices posted a record decline in July. Data from the U. S. Bureau of Labor Statistics showed that, on a seasonally adjusted basis, lettuce prices fell 16.4% month-on-month, the largest single-month drop on record and the biggest decline among food categories in the consumer price index for that month. Overall food prices rose 0.1% month-on-month. The price plunge was linked to a multi-state cyclospora outbreak, which significantly reduced consumer demand for lettuce. Despite the decline, July lettuce prices were still about 7.5% higher than a year earlier, more than double the increase in the overall CPI basket. In previous months, lettuce prices had been climbing, driven by factors including higher fertilizer prices from the Iran war and rising farm labor costs from mass deportation of immigrants.

The farm has voluntarily recalled products from that location. Several restaurant chains that use lettuce in their menus reported lower traffic due to consumer concerns, even though their supply chains were not contaminated. Mediterranean fast-casual chain Cava said the outbreak triggered broad consumer worries about leafy greens and fresh produce, affecting recent sales at the end of the second quarter, but sales trends have begun to recover. Salad chain Sweetgreen said demand fell and cut its full-year outlook. Chipotle said the cyclospora outbreak caused a sales impact of about 2 percentage points in the second half of July, but confirmed its lettuce supply was unaffected and emphasized that its food safety program remains robust. The chief executive of Yum Brands said the outbreak had a significant near-term sales impact on its Taco Bell brand, but sales are steadily improving.

Market data from NielsenIQ showed that in the four weeks ending July 25, pre-packaged salad sales fell 14% year-on-year. Despite the sharp drop in lettuce prices, consumers did not take advantage of the lower prices due to ongoing food safety concerns. The outbreak has sickened thousands, and consumers are unlikely to increase purchases in the short term even with lower prices.