Food prices in Germany projected to soar
Prices for food in German grocery stores will keep growing and are set to surge another 10% this year, Germany’s Handelsblatt newspaper reported on Sunday, citing the latest analysis by international insurance company Allianz Trade.
In monetary terms, the surge will reportedly total €250 per person per year. The latest price hikes are attributed to the increasing costs of energy, raw products and production goods.
“High inflation and post-pandemic declines in in-store grocery sales are putting pressure on grocery retail profitability,” Aurelien Duthoit, sector consultant at Allianz Trade told the newspaper. “In this respect, the price increases are likely to have a significant impact on consumer prices in the near future.”
According to the survey published by the Ifo Institute for Economic Research in Munich, 9 out of 10 food retailers are planning to raise prices further due to the rising costs of electricity, raw materials and industrial goods.
“The worst is yet to come for households,” Duthoit warned, adding that retail food prices are not reflecting real price increases over the past 18 months.
Last week, The German Farmers’ Association reported that the tense situation on the agricultural markets because of the Ukrainian crisis will probably last for months. The critical supply situation is forecast to last well into the coming year and beyond the 2023 harvest, according to Deputy Secretary General Udo Hemmerlin, who expects further price increases for consumers.
Retail prices for dairy products are expected to rise by 20% in the near months, according to Björn Börgermann, Managing Director of the Association of the Dairy Industry.
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