The price for food in Mexico is probably no different than prices for food in the US. In fact, I would say, that generally speaking, labor is cheap, while goods in Mexico are expensive.
There are ways, if one is willing, to buy quite locally at a central market. I don’t think there’s a city in Mexico that doesn’t have its own central market. If you want to spend less money, you can certainly buy the basics–vegetables, meat, fruits– and some other small items –rice, beans, spices, milk, butter– those kinds of things, in the central market and you can get them at a better price. If you go to the big grocery stores, you’re probably actually going for the most part pay a higher price than in the US.
I’ll give you an example. We now can buy Tide laundry soap here. The small Tide costs around $23 in Mexico. That same size Tide at Walmart in the US is $11. Goods like that that are imported are expensive. A block of Tillamook cheddar cheese (which we don’t get very often) is somewhere around $8 and it’s just the regular size; it’s not like a big chunk. So there are certain items that are quite pricey. And generally speaking, groceries here are about the same price. You’re not going to save any money, unless you want to go to the market and get those things.
When you go into the market, you can buy purses, dresses, blouses, jewelry, silver, and aloe vera, and one whole section is just groceries. They have fresh meat. The vegetables are fresh, as they are brought in almost every single day. The fruits are the same way. It’s not quite as good of variety as you might find in the grocery store, but I can tell you it’s a lot fresher.
I don’t actually go to the market because it’s just crowded and right now, it’s too hot. Sometimes in the winter, I’ll go. I’m just not going to go walk around in that sweltering building. Also, I’m by myself so 2 apples is enough. If I were buying for a family, that would be a whole different thing. You know, a small box of rice is good enough for me. I don’t have to go over there and scoop a handful or scoopful of rice and beans. And I don’t cook very much, so I’m fine just going to the grocery store. Mostly, that’s what works for me.
The grocery stores do have versions of the brands I would buy in the US at lower prices, but generally, I don’t like them. And, of course, I’m like a lot of American expats living in Mexico in that I make at least two trips a year in my car to the US, so I bring back my own laundry soap.
Where I live in Mazatlan (and I have no idea if this is typical all over Mexico), our water is really hard. As a result, your clothes just don’t last as long, and I don’t like the laundry soap here. (I’ve tried several) and I’m not going to spend $23 for Tide, so I buy Tide when I go to the US in a great big jug. And it will last me a year.
I live in Mazatlan, which is a tourist destination beach community. I’ve also lived in other tourist destination beach communities. Anywhere in the world where you have this, you’re going to find that prices are a bit higher. If you want to live further inland, I suspect you could buy at cheaper prices.