Food inflation expected to drop

Food inflation in 2009 may fall to 4.5% amid lower dairy costs, the U.S. Department of Agriculture said.

The forecast for inflation, estimated at as high as 6% this year, is falling as commodity prices drop, the USDA said in a monthly report. Crude oil has plunged 73% from its July peak of $147.27 a barrel. Corn, wheat and soybeans are all at least 46% below their all-time highs.

Prices for dairy products, which rose as much as 9% this year, may fall as much as 4% next year, the USDA said.