Food products prices at 10-year peak, continue to rise
The price of a food basket has risen by 5 percent and is at a peak for the past decade, director of the Institute of Economic Research Marje Josing says. The same rate of inflation is expected next year.
Josing also highlighted the expectation that many Europeans have that food prices must be low, and questioned whether it should be like this.
While the food price constitutes up to a quarter of a household's expenses, Josing said that this proportion could be even higher when it comes to animal welfare and the environment: "Maybe we should save in other areas: families spend a lot on alcohol, entertainment and communication costs," she said.
"It's clear that the food price increase is not yet over," Josing said and specified that the price of several products will increase even more at the beginning of the year.
"The prices of oil, grain and meat products have increased around the world," she added.
Although food prices haven't been as expensive for 10 years, some products have bucked the trend and become cheaper, Josing said, for example, communication costs. "Some dairy products might get cheaper, some products, like bread, has been quite stable in price," he added.
The price of a food basket also depends a lot on the consumption habits of families, and is very individual depending on whether more raw materials or ready-made food are bought.
Josing said that the arrival of the Lidl store chain, which will soon be opened in Estonia, has probably slowed down the even higher rise in food prices, which is why several other chains have postponed the price increase. Buying imported goods will definitely help families save money in the future as well.
"Maybe it's a relief for the consumer in mass goods, where the local taste is not so important to a person, in this case, you can really find something in Lidl." Josing said, "but it's quite a worry for the industry."
Follow ERR News on Facebook and Twitter and never miss an update!
Editor: Roberta Vaino