Grocery stores are slashing prices to win customers. Why your grocery bill may still rise.

After years of grocery price inflation, some of the country’s biggest retailers are trying to change course.

Kroger, which said in May it would lower prices on more than 1,000 items, now faces a growing list of competitors doing the same. Walmart announced this week that it is cutting prices on thousands of products, including ground beef, cherries, Coca-Cola and laundry detergent. Costco, Target and Whole Foods have also rolled out discounts on select grocery and household items.

The flurry of price cuts comes as retailers compete more aggressively for shoppers who have become increasingly careful about where and how they spend their grocery dollars.

For Oregon shoppers, that could translate into lower prices on some staples at stores such as Walmart and Fred Meyer. But economists and industry analysts say those cuts are unlikely to bring down overall grocery bills anytime soon.

Instead, the discounts reflect a change in consumer behavior.

Shoppers are buying less, switching brands and spreading their purchases across multiple stores to find deals. A May CNN poll of roughly 1,600 adults found 61% of Americans have changed the groceries they buy to stay within budget.

A recent report by consulting firm AlixPartners found shoppers, in search of lower prices, are making fewer trips to traditional supermarkets, buying only what they need, and increasingly splitting purchases among warehouse clubs and discount chains such as Costco, Aldi, WinCo and Grocery Outlet.

That shift has put pressure on grocers, which already operate on thin margins, to compete more aggressively on price, said Rajiv Sharma, an associate professor of economics at Portland State University.

“They’re focusing on the items people notice most,” he said. “The goal is to attract customers to come in and have them buy other things once they’re there.”

Those highly visible items often include meat, produce, eggs and soft drinks, products shoppers use to compare prices between stores, he said.

Sharma said he is skeptical the recent announcements will lead to meaningful savings overall.

“We’re in an environment that’s not very conducive to broad price declines,” he said, pointing to ongoing uncertainty in energy and global supply chains.

The war with Iran has pushed up energy costs, which ripple through the food system. Diesel fuels farm equipment and transportation. Fertilizer, a major cost for farmers, has also become more expensive after disruptions to global trade routes.

About 30% of internationally traded fertilizers pass through the Strait of Hormuz, a key shipping route affected earlier this year. Prices for some fertilizers surged this spring, according to the International Food Policy Research Institute, adding to costs for growers already operating on tight margins.

Those higher costs eventually show up at the grocery store.

At the same time, retailers are careful about how far they go with discounts, Sharma said. Grocery stores typically earn just 1.5% to 2% in net profit on food sales. He said that leaves little room to cut prices across the board.

Instead, they are targeting specific items while trying to protect margins elsewhere, often by steering shoppers toward private-label products, Sharma said.

“Grocery stores almost always run promotions,” he said. “But cutting prices on everything would make their business model very difficult to sustain.”

Walmart’s announcement is the latest example of that strategy.

The company said it is lowering prices on popular summer items, including grilling foods and beverages. Some cuts are modest, such as a dollar off a case of soda. Others are more noticeable, including sharp discounts on produce like cherries.

Other chains are following a similar playbook.

Kroger said this spring it plans to reduce prices on more than 1,000 items after testing which discounts resonate most with shoppers. The company, which operates Fred Meyer stores across Oregon, has said it also is pushing suppliers for better deals.

Costco executives told investors during its latest earnings call that the company has cut prices on several Kirkland Signature products, including chicken wings, chocolate almonds, beef and eggs. Target recently announced it reduced prices on thousands of pantry staples, while Whole Foods has lowered prices on about 900 private-label items.

Even with those changes, grocery prices remain elevated. Food-at-home prices are still well above pre-2020 levels, and federal forecasters expect them to keep rising this year.

The U.S. Department of Agriculture now projects food-at-home prices will increase about 2.8% in 2026 – slightly lower than May’s forecast of 3.2%. But that number still exceeds the long-term average by a notable margin, the USDA reported.

For shoppers, that means the recent wave of discounts may help at the margins but won’t solve the bigger problem.