LB: Food prices to rise faster this year than last year due to rising raw material costs

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BNS 2025-01-22 13:01:05 Comments: 0

Food prices will rise faster this year and next than last year due to the rising cost of raw materials, says a representative of the Bank of Lithuania (BoL). The Ministry of Agriculture (MAA) forecasts that food prices will rise by 0.9–2.1 per cent this year.

„Both this year and next year food raw materials prices will increase and this will affect prices for the population“, Laura Mociūnaitė, a senior economist at LB's Macroeconomic and Forecasting Division, told the Parliament's Budget and Finance Committee on Wednesday.

Evaldas Pranckevičius, Head of the Economic Analysis Division of the FMA, said that the overall price increase will be mainly influenced by the rise in the price of some dairy products, such as milk, butter, cheese, as well as eggs, which could reach 0.7%.

At the time, the committee's chairman, Social Democrat Algirdas Sysas, argued that the statistical price averages provided by the authorities differed significantly from the reality that shoppers see in the shops.

„People simply cannot believe their ears when they hear experts say that food prices in Lithuania are not particularly high. (...) I see all kinds of statistics, but when I go to the store and look at the shelves, well, I can't find that average price. All the prices are higher than average," Sysas said in a statement.

Butter may cost €9 in a small town, he said, but "you won't find such prices in the whole of Vilnius".

According to Mociūnaitė, food prices in Lithuania last year were on average 0.2% lower than the year before, while in the European Union (EU) they rose by around 2%, and in Estonia and Latvia by even more.

„There will be no significant increase or decrease in pig farm gate prices in Lithuania and the EU. They should remain stable," she said.

According to Ms Jankauskiene, cereal prices this year should also remain at last year's level, while milk and milk products may continue to increase in price due to the slowdown in the production of raw milk and the limited supply, as well as the increased consumption of these products.

L. According to Mociūnaitė, food prices in 2024 have increased by 50% compared to 2020.

Consumer prices are currently increasing slightly more than traders' costs compared to 2020, she said: „However, this gap is narrowing. (...) It is likely to continue to shrink.“

According to Daiva Jureleviciene, First Deputy Director General of the Government Data Agency, prices of imported food fell by 3% in November last year compared to the same time the year before.