Food prices increased for the 16th month – Consumer defenses – How empty the basket was
Consumers are experiencing precision shock ahead of a bleak winter, as they now increasingly choose private label products, sale items and bulk foods to half-fill their supermarket baskets.
Up for the 16th month
The upward trend of the “Food and non-alcoholic beverages” sub-indicator, which started last year in June, continued in September this year, as can be seen from the data of the Hellenic Statistical Authority, with the pressure multiplying for the economically vulnerable. It is recalled that poor households spend more than 1/3 of their monthly budget (34.8%) on buying food.
Due to the higher prices, which are reflected in the extra turnover for supermarkets (sales reached 5.42 billion euros in value in the 8 months of this year compared to 5.23 billion euros in the corresponding period of 2021, according to the market research company IRI ), consumers are reducing the volume of their purchases, with the gap between the growth rate of sales value and sales volume widening month by month.
In the January-August 2022 period, sales volume fell by 1.6% compared to the same period in 2021, while supermarket turnover increased by 3%, according to the latest available IRI data.
Increases 19.3% in 11 months
It is characteristic that in a list of 25 branded products the total bill has risen 19.3% compared to last November when inflation started to “bite”.
Even excluding products that were disproportionately affected by the war in Ukraine, the appreciations are reminiscent of drachma times.
Specifically, from November 9, 2021 to October 5 this year, the average price of a liter of branded sunflower oil has risen by 90%, according to data from the Ministry of Development’s e-Consumer electronic platform.
In corn oil (one liter) the increase reaches 41% in the same period, while a kilo of all-purpose flour is sold on the shelf 35.6% more expensive.
And if the price hikes in the above products are expected due to the supply chain crisis, the high double-digit price hikes shown by other products, in the categories of food, household goods and personal care and hygiene, show that the accuracy due to energy costs has spread everywhere.
For example, the price for three kilos of potatoes has increased by 50.5% in 11 months. Correspondingly, for yogurt, a package of 500 grams, the appreciation reaches a rate of 46%, while for a bottle of 400 ml of liquid dishwashing detergent, it is a rate of 38%. The increase in branded toilet paper (+38%) on 8 rolls is similar.
Six medium eggs cost 33% more compared to November 2021, a liter of fresh milk 22% more expensive, while the price for a 400g packaged slice of feta is 20% higher. An increase of 22.8% must be paid by the consumer for the smoked turkey, package of 160 grams, while for the toasted bread 8.5% and for the instant coffee 7%.
Third wave of revaluations
But the point is that on-the-shelf markups don’t seem to be stopping, with supermarket industry executives estimating that the average increase in the fast-moving code basket could reach as much as 15% by the end of 2022.
Product categories that are set to increase in price within October include poultry, frozen vegetables, dairy, cold meats, soaps – detergents – cosmetics, olive oil and stationery.
In this unprecedented situation, the Ministry of Development is proposing the “basket” of 50 basic products as a brake on the worst, although everyone admits that this is a difficult exercise.
This is because the price increases in this list of products, which will include food (meat, vegetables, fruit, flour, dairy, coffee, oils, cereals, eggs, pasta, legumes, tomatoes, sugar, frozen, snacks, etc. ) and non-food (detergents, general purpose cleaning products, stationery, personal hygiene products), are not prohibited. Nor is a “freeze” imposed. There is simply a commitment that the mark-ups are lower compared to the rest of the corresponding products and that they “go” on the shelf at less frequent intervals.
Besides, in order to reach the goal of smaller price increases, the agreement of the suppliers should also be ensured, when the operating costs of the companies have jumped due to energy and raw materials.
For this matter, the Minister of Development, Adonis Georgiadis, will have a meeting with industry representatives next week, while he assured the president and members of the administration of the Central Union of Chambers that the subsidization of electricity and natural gas tariffs will continue for all businesses of the country.