Food inflation accelerates in May as dairy, fruit and red meat prices climb
Monthly Food Inflation Update - May 2026
Australia’s food inflation picture strengthened through May, with the latest Consumer Price Index data showing broad-based monthly increases across much of the food basket.
While fresh produce and dairy were the standout movers during the month, the annual inflation profile continues to be dominated by red meat and beverages.The May figures suggest food inflation remains far from uniform, but the number of categories recording price increases expanded noticeably compared to April.
The monthly movement from April to May shows stronger inflation momentum than seen in recent months, with gains recorded across most food categories.
Dairy was one of the standout performers as milk prices jumped 4.7 percent during the month, while dairy overall increased 2.3pc and cheese rose 1.7pc.These were some of the largest monthly movements recorded across the food basket.
Fruit prices increased 3.5pc during May, helping lift the combined fruit and vegetable category 1.1pc higher despite vegetable prices declining 0.9pc.
Lamb and goat prices rose 1.6pc, beef increased 1.4pc, pork lifted 0.7pc and poultry gained 0.5pc. The broader meat and seafood category rose 1.1pc, reversing the softer result seen in April. Fish prices increased 1.7pc over the month, while eggs edged 0.4pc higher.
Beverages provided one of the few areas of weakness. Coffee and tea prices declined 1.0pc during May, while alcohol prices increased 0.9pc.
Year-on-Year Results
The annual picture into May continues to highlight the influence of livestock markets on food prices.
Beef remains the strongest performing category, rising 8.8pc over the year, while lamb and goat prices increased 8.7pc. Tight livestock supplies and robust export demand continue to underpin domestic pricing, helping push the broader meat and seafood category 3.6pc higher than a year ago. Pork prices are up 1.1pc annually, poultry has increased 0.6pc and fish prices are 1.3pc higher.
Beverages continue to contribute to inflation pressures.Coffee and tea prices remain 4.7pc above year-ago levels despite recent monthly weakness, while alcohol prices are up 3.2pc over the year.
Dairy inflation has become more noticeable. Milk prices are now 3.5pc higher than a year ago, while the broader dairy category has increased 2.2pc. Cheese remains one of the few categories still recording a small annual decline, down 0.1pc.
Fresh food has also firmed compared to earlier months. Fruit prices are now 1.6pc higher than a year ago, vegetables have increased 0.7pc and combined fruit and vegetable prices are up 1.1pc. Eggs remain the weakest category, sitting 1.6pc below year-ago levels.
The May data suggests food inflation is becoming more widespread across categories after several months where fresh food and dairy provided some offset to higher meat prices. While red meat remains the dominant annual driver, stronger monthly gains across dairy, fruit and protein categories indicate inflation pressures are no longer concentrated in just one part of the food basket.
Food inflation strengthened through May, with broad-based monthly gains replacing the more mixed results seen earlier in the year. Annual inflation remains heavily influenced by red meat, but dairy and fresh produce are now contributing more meaningfully to overall food price growth.The result is a food inflation environment that remains uneven, but one where upward pressure is becoming increasingly widespread across the supermarket basket.