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According to the Department of Statistics, food prices increased 2% on average in July. Although this number does not seem high, Pricer.lt’s analysis of consumer goods reveals that individual products became more than 40% more expensive.
For example, the cheapest black bread cost 44 percent in July this year. more than at the same time last year, ground coffee “Jacobs Kronung” – 42.8 percent. What is driving food prices up this year?
Vegetables become more expensive due to poor harvests
According to the Department of Statistics, the most expensive group of food products per year are vegetables. They cost almost eight percent more in July than last year. True, a closer look shows that individual vegetables became much more expensive. According to Pricer.lt, the price of potatoes increased by 22.4 percent during the year.
Photo by Vida Press / Potatoes and dill
“Last year’s early harvest looked much better, there was more supply, so of course prices were lower,” he said. 15 minutes commented Zofija Cironkienė, director of the Lithuanian Vegetable Producers Association.
According to her, the early harvest this year was smaller and this could have affected the price of vegetables.
Also, the cost of vegetables is higher. It needs intensive watering. The seeds, the fuel are more expensive, as well as the labor ”, taught Z. Cironkienė.
Ernesta Dapkienė, director of the Department of Communication and Image of the Maxima retail chain, agrees that the prices of vegetables depend on the harvest and the latter is determined by the weather.
“We hear fears from vegetable growers that a large part of the harvest will be lost due to this extremely hot summer. Farmers also say that costs are rising due to rising fuel and electricity prices, ”he said.
Why did oil get more expensive?
Statistics provided by the Department of Statistics show that the prices of oils and fats have risen almost six percent. In terms of specific products, the growth is higher: according to Pricer.lt, the price of unrefined Obeliai sunflower oil (0.9 liters) has risen almost 13 percent.
“Oil is a commodity, so price fluctuations depend on many global factors: weather conditions, smaller growing areas, increasing use of diesel fuel (rapeseed oil mixed with it), export restrictions in Russia. , etc. “, explains E. Dapkienė.
He adds that the price of crude has risen since last year, making the product more expensive.
Milk and meat become more expensive
The rise in prices does not exceed other food products, including dairy and meat products. For example, according to the Pricer.lt basket, the price of “Dvaro” sweet cream butter increased by 15.4 percent, the fermented semi-hard cheese “Dvaro” by almost 12 percent.
123RF.com nuotr./Pienas
“We know that the price of electricity has increased by 10 to 15 percent, packaging, gas, milk, the main raw material, have also risen in price,” says Gintaras Bertašius, owner of Vilkyškių pieninė.
It maintains that the price of raw materials is higher than that of production.
“It simply came to our knowledge then. We are intermediaries between raw materials, we produce, we have a cost and we have to sell so that there are no losses,” explained the businessman.
Gintaras Valančius, Chairman of the Board of Klaipėdos Mėsos, adds that raw materials and energy resources have become more expensive and employee salaries have increased.
Vida Press nuotr./Mėsa
“Electricity has risen in price almost twice, gas almost 50 percent and labor has become more expensive for lack of it. As it seems, there are many unemployed people, but we cannot find employees,” he said.
G. Valančius states that the meat products in the whole basket are the least expensive.
“Meat may have risen in price by only 10 percent,” he said, adding that his company’s prices had not changed.
However, despite the increase in prices of various goods, the prices of the cheapest products did not change. The Pricer.lt survey revealed that the average basket of cheapest food products in Lithuanian stores increased by +0.04 euros compared to June 2021 and was – 4.39 euros or 7.6 percent. cheaper than in July last year.
The economist urges not to jump to conclusions
Sigismund Mauricas, chief economist at Luminor Bank, explains that one should not jump to conclusions about rising food prices.
“Sometimes it is due to the competitive environment,” he said, explaining that the calculation methodology often determines the price rise.
Luke April / 15min photo / Sigismund Mauricas
“Not all product prices are observable, only the most popular ones. Sometimes it happens that the price of a product in the basket goes up a lot and the general index jumps,” said the economist.
He explains that food prices in Lithuania are not rising as much as they could.
“There is a very good chance that annual growth will be around five percent and even reach six or seven percent by the end of the year,” Maurice said.
According to him, one of the reasons why prices are not rising so far is increased competition.
“Lithuania as a small country has five big players: Maxima, Rimi, IKI, LIDL and Norfa, which is a lot,” he said.
Another reason, according to the economist, was the popularity of online trading last year.
“It is much easier to compare prices there,” he concluded.
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