Speaking at a press conference for the Estonian Food Industry Association on Wednesday, Lomp said retail trade volumes have declined every month for two years.

"This is mainly due to strong price growth. Not only food prices, but also other services and goods," he said. "Seeing consumer behavior every day, it's at an all-time low. There's really no sign of improvement."

Compared to three years ago, each customer buys one or two items less on average. However, the share of Estonian food in baskets has remained the same, at 54 percent, in Selver this year.

"The biggest decrease in Estonian food is butter, the biggest increase is in health products," Lomp pointed out and justified the increase in the sale of health products by the fact that many local producers have joined.

Lomp said more than half of the goods sold in chain stores are discounted products. In the past, the share was between 35-38 percent, but now it has risen to 50 percent, and sometimes higher.

Prices are expected to rise next year, she said, as VAT will rise.

Sirje Potisepp, head of the Estonian Food Industry Association, pointed out that several other taxes will also be introduced in 2025 which will also affect food sales.

Milk prices are rising

Tere and Farmi brand producer Nordic Milk OÜ's dairy industry head, Ülo Kivine, said prices in the dairy sector are volatile and rising again.

He said most Estonian producers tie their prices to the European Union average, where pricing pressure is being caused, among other things, by the Netherlands and Denmark reducing their national dairy herds starting next year.

In Estonia, the productivity of cows has grown significantly compared to the early 1990s. Kivine noted that while milk production then was similar to current levels, there were 60,000 more cows. However, this increase in productivity has led to a decline in the average fat content of raw milk.

Speaking about prices, Kivine said he has never seen cream prices as high as they are now.

"Every Wednesday, it changes, and today it has risen a few notches again. Why this is happening, I have no idea," he admitted.

Maag Food's CEO Silver Kaur said meat production faces major challenges. These include increasingly strict regulations and livestock diseases, which have caused significant problems in recent decades.

In Estonia, meat consumption and production have decreased. Last year, production dropped by 5 percent, with poultry production falling by only 1 percent but pork production decreasing by as much as 10 percent. In the future, poultry consumption is expected to surpass pork consumption, as poultry is considered healthier.

"We eat more meat than the average global citizen — 100,600 tons annually," said Kaur, noting that this equates to 74 kilograms per person per year.

The share of imported meat sold in Estonia has grown, which Kaur said was a sad fact. Competition between branded products and private-label products continues, with the latter gaining market share due to their lower prices.

"Increasing production volumes is a challenge," said Kaur. "NIMBY (not in my backyard) — build your farms wherever you want, but not here. The classic answer, regardless of the field, is always to suggest Ida-Viru County," he added.

Customers buying bread and baked goods again

Leibur's CEO Ott Neeme stated that the sales volume of bread and bakery products in Estonian retail chains has grown by 5 percent this year. This indicates a decent recovery, although it has not yet returned to pre-war levels before the start of the conflict in Ukraine.

"In recent years, the decline has also been influenced by consumers' price sensitivity and general inflation, but the bread and bakery category has been in decline for a long time. The younger generation consumes less bread and bakery products," Neeme said. He added that producers are trying to create more products that appeal to younger consumers.

Bread sales volume increased by 10 percent in the first half of this year, while bakery sales rose by nearly 2 percent. Sliced bread sales have risen, but sales of classic loaf-shaped breads and buns have declined.

Prices of bread and bakery products have fallen by 3 and 2 percent, respectively.

Looking ahead to next year, Neeme highlighted rising prices These are affected by up to a 7 percent increase in both raw material costs and wages.

Labor shortages also remain a significant challenge.

"Young people are not interested in production jobs, so higher wages must be offered to attract them and retain existing workers," Neeme explained.

Jaanus Vihand, CEO of A. Le Coq, criticized planned excise tax increases. He said customers will start buying alcohol from Latvia again.

The CEO said the company's packaging costs will rise by €2 million next year due to new environmental requirements implemented by suppliers. He also pointed out that new tear-off bottle caps will result in seven tons more plastic being used annually compared to the previous solution.

"This is completely contrary to what was intended from an Estonian perspective. Our deposit system largely eliminated this cap problem," Vihand said.

Since 2022, the sales of private-label beverages have increased in Estonia. According to the beverage producer, this is largely due to Lidl's entry into the Estonian market, as most of its products are private-label brands.

Vihand predicted that the orange shortage will continue but that new additions such as apple, cherry, rhubarb, and blackcurrant will appear. Raw material prices are expected to keep rising.

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