US Retail and Wholesale Price Volatility Indices

Prices of fresh produce and meat fluctuate widely. Gro created the retail and wholesale price volatility indices to track an array of fruits and vegetables. Volatility is calculated by taking the standard deviation of weekly percentage changes over the past three years and annualizing that value, a metric that gives us a good sense of volatility while accounting for inherent seasonality that exists in fresh produce prices. Even within product groups, price volatility varies widely depending on the cultivar or packaging type.

Customers use this indices to

• Track which produce prices fluctuate the most
• See how factors like packaging affect price volatility
• Track changes in prices and volatility from different origins, which can affect procurement decisions
• Understand what’s driving fluctuations in fresh produce markets
• Analyze which products’ volatility (risk) contribute most to forward earnings

Why It Matters

Fresh produce has long been one of the most volatile markets in the world. Our indices shows that prices for fresh produce in the US are more volatile than for almost any other commodity or financial market. A Gro analysis of historical volatility, which measures both positive and negative fluctuations in price, shows that retail prices for 500 of a sample of 640 fresh produce items have annualized volatility greater than 100%. Prices of iceberg lettuce, for example, jump around by 457% over the course of a year, and cucumber prices swing by 465%. That’s far greater fluctuation than, for example, crude oil—now one of the most volatile exchange-traded commodities—which has annualized volatility of just 41%, and the S&P 500 Index which trades with annualized volatility of 21%. For corn and soybean futures, volatility is 16% and 15%, respectively.

Related Resources 

Display: Volatility-adjusted US Retail Prices

Display: Iceberg Lettuce Supply Monitor 

Display: Retail Price Volatility