Faced with the precision at foods households in Greece will continue to be in the coming months, as already at the beginning of the year several companies have revaluations and some others are planning price increases the next period.

Although the frequency with which suppliers change price lists is not as high as it was in 2022, a senior executive at a major supermarket chain told Money Review, price increases are still arriving, without the industry sending out price lists with price reductions. The phenomenon of price reductions in some products recorded at the end of January, reductions of 5%-18%, and related mainly to imported dairy products and corn oil, did not have a similar continuity and proved to be rather limited in scope. A few days ago, after all, a NielsenIQ survey of supplier and retailer CEOs showed that seven out of ten companies are planning price hikes in 2023.

Several suppliers, in order to maintain market shares, did not make significant price increases in 2022, but are doing so now as pressure on production costs continues. As they point out, energy costs may be showing signs of abatement, but the same is not true for transport costs, which are expected to increase further in the coming period, as well as for the cost of primary and secondary materials.

It is recalled that from April 2022 food inflation in Greece is in double digits and from October 2022 it moves to the level of 15%. It is even maintained at these high levels, despite the fact that the general consumer price index records a significant deceleration since the autumn.

More expensive basic food items

What’s worse is that at the top of the price hikes are the most basic food items, such as dairy, bread, meat and oil. According to the latest data available from the Hellenic Statistical Authority (ELSTAT), the prices of dairy products have increased by 25.2%, oils by 22.9%, meats by 20%, bread by 16.8%, coffee by 13%, sugar by 9.2%, water – juice – soft drinks by 9%, vegetables by 8.6%. In order to understand the issue especially in the dairy sector, it is enough to say that the average producer price for cow’s milk is, according to ELGO – DIMITRA data, at 0.574 euros/kg from 0.438 euros/kg in January 2022, while in last year the average price had reached 0.588 euros/kg. The average producer price for sheep’s milk used mainly for cheese and yogurt stands at €1.56/kg from €1.17/kg a year ago, showing no signs of abating.

Large price increases in food have led to a decrease in sales volume, which is proportionally small to the increase in prices. The reason is that many consumers have turned to private label products, which have also recorded significant price increases of 16.6% in 2022. It is recalled that the volume of sales in supermarkets fell in 2022 by 1.5% (data of NielsenIQ), while in the first quarter of 2023 the sales volume is estimated to decline by approximately 4%.