Grocery inflation ran at an annual rate of 2.2% in August, down from 2.7% in each of the previous three months, according to the Bureau of Labor Statistics. But food industry experts speaking Thursday at a briefing hosted by FMI — The Food Industry Association said that relief will not last.

Elevated fuel costs are starting to wear down retailers and suppliers that have so far kept price increases contained for many products, the experts said. The sustained rise in oil prices driven by the Iran war this year is putting enough pressure on the grocery industry that retail prices are unlikely to remain in check as the year progresses, said Ricky Volpe, professor of agribusiness at California Polytechnic State University.

"We have evidence that there have been some explicit efforts by food companies, retailers, manufacturers throughout 2026 to keep prices down [to] remain competitive [and] address customer sentiment," Volpe said. "But I do not think that can last forever, and I will be surprised if we don't see food price inflation tick up somewhat for the last quarter of 2026."

Volpe expects rising pressure from fuel costs to push grocery inflation to an above-average rate for 2026 overall. He estimated the rate could hit an annual pace of about 2.7% for the year.

Diesel is the sharpest edge of the problem. Rising diesel costs pose a particularly potent threat to the industry — and ultimately to grocery shoppers — because the fuel is so widely used, Volpe said, adding that the impact will filter through in phases. Higher fuel prices already pushed up the producer price index, a key gauge of the direction prices are headed, last month, he noted.

The pressure is record-setting. Diesel prices hit a record of more than $6 per gallon earlier this month, J.P. Morgan reported.

The cumulative cost to consumers is already large. Increases in diesel and gasoline costs since the war started at the end of February have cost U.S. consumers more than $113 billion, according to a tracker run by the Climate Solutions Lab at Brown University's Watson School of International and Public Affairs.

Higher transportation costs make it more expensive to move goods from distribution centers to stores, which puts pressure on retailers to raise food prices, Volpe explained. Costs tied to storing cold products, running warehouses and other parts of the supply chain that depend on diesel can take longer to pass through to prices, he added.

Agriculture adds another channel for energy costs to reach the grocery aisle. Farmers rely heavily on diesel and will soon need to make planting decisions for the next growing season, so higher energy costs could begin pushing grocery inflation upward in the coming months, Andy Harig, FMI's vice president for tax, trade, sustainability and policy development, said during the briefing.

For food marketers and retailers, the implication is direct: after a year of deliberate price restraint aimed at protecting customer sentiment, the margin cushion that made that restraint possible is thinning, and Volpe expects the break in grocery inflation to end in the fourth quarter of 2026.