Expect Volatile Food Prices and Changing Consumption Patterns in 2025

Restaurant operators can expect 2025 to bring big changes in the food sector both in the U.S. and globally. The interplay of ongoing inflationary pressures and potential trade disputes, particularly with Mexico and Canada, is likely to keep food prices volatile in 2025—especially for fresh fruits and vegetables, according to agribusiness/food expert Rob Dongoski, a partner and global lead in the Food and Agribusiness practice of global strategy and management consultancy Kearney.

"Tariffs could exacerbate affordability challenges for consumers, particularly in lower-income demographics, while reshaping the availability of fresh produce in grocery stores and restaurants," he said.

Widespread adoption of GLP-1 drugs such as Ozempic, used by approximately one in eight U.S. adults, is fundamentally altering food consumption patterns.

Widespread adoption of GLP-1 drugs such as Ozempic, used by approximately one in eight U.S. adults, is fundamentally altering food consumption patterns and driving demand for nutrient-dense, smaller portion sizes, and functional foods, Dongoski noted.

"What will this mean for food producers and manufacturers? In 2025, food companies will prioritize innovation beyond traditional volume-based models and billion-dollar hero SKUs – the shift has significant impact potential on their product portfolios and marketing strategies."

A broader FDA crackdown on food dyes and manufacturing ingredients is gaining momentum, with multiple synthetic colors facing immediate scrutiny, according to Dongoski. This federal focus, combined with state-level actions, will accelerate food companies’ proactive reformulation of products, removing synthetic additives in response to both changing consumer preferences (bottom-up) and regulatory pressure (top-down). Increased transparency requirements are likely to be implemented, compelling food manufacturers to disclose more detailed information about synthetic additives, their origins, and potential health impacts on product labels and in marketing materials.

"The CPG industry is navigating a complex regulatory landscape and growing “Make America Healthy Again” (MAHA) movement that is consumer-led with potential regulatory teeth under an RFK Jr.-led Health & Human Services (HHS)/ Food & Drug Administration (FDA)," he noted.

Another issue impacting restaurants, according to Dongoski is that the recent Farm Bill extension into 2025, while averting a crisis, leaves farmers and ranchers reliant on outdated 2018 provisions. 

"The 2024 Farm Bill negotiations signal a potential pivot in agricultural policy, with traditional subsidy programs facing increased scrutiny and partisan divides stalling progress on climate and anti-hunger initiatives. The incoming Republican-controlled Congress could significantly reshape agricultural priorities in 2025. This shift may impact funding for conservation programs and the allocation of Inflation Reduction Act dollars, potentially changing landscape of federal support for growers and ranchers."