Costs of food producers increasing by 30-40%

Inflation in May accelerated to the fastest pace in over 24 years. The two main reasons are rising energy and agricultural commodities. However, while food in stores increased by an average of several percent, producer costs increased three to four times. This will continue to be reflected in retail prices. Although there is no drop in consumption so far, it will turn out in the autumn that products Poles resigned because of the high prices, which may additionally worsen the situation of producers. The lack of some raw materials or packaging is also their problem.

"Producer inflation in food production definitely exceeds 30-40 percent. These are huge increases in costs. Producers have little ability to cope with this because all indications are that their financial stocks have already been depleted during COVID. So there is no chance to accumulate it in the enterprise. All this is now being translated into prices, which in a way we consumers also see after some time in the form of inflation of finished products," Andrzej Gantner, general director and vice-president of the Polish Federation of Food Producers, assessed.

Prices of agricultural products are higher by several dozen percent than a year ago. According to GUS data, in April for basic agricultural products (wheat, rye, beef, pork, poultry, cow's milk) prices were 45 percent higher than a year ago. Cereals were the most expensive: between 67-84 percent. Pigs were more expensive by 30 percent compared to the previous year and other types of livestock by about 55 percent. The same kind of increase was noted for corn, whereas milk cost 40 percent more. The smallest difference was seen in potatoes – 10.4 percent. Meanwhile, prices in stores jumped on average by 13.9 percent, with food and non-alcoholic beverages increasing by 13.5 percent.

(Newseria)