Increase in food prices in Germany higher than in other EU countries: that’s the reason

For some time, consumers have been accompanied by news about rising food prices in supermarkets and discounters. The differences in the price range are evident not only in comparison with the figures from previous years, but also in comparison with other countries in the European Union.

According to the Portal Express, the inflation rate in Germany at 15.5 percent for food and thus exceeds the inflation rates of countries such as France, Luxembourg or Ireland – there the prices for food and non-alcoholic beverages rose by a good 8 percent. With regard to this relationship, how can the marked difference be explained?

Food prices in supermarkets and discounters have risen sharply – what are the causes?

First of all: Germany is not the front runner in an EU comparison when it comes to a rising inflation rate for food. Currently at Eastern European countries it is noticeably higher: in Lithuania or Latvia food inflation is over 25 percent, in Hungary even 33 percent. In Germany, according to the “Wirtschaftswoche”, one reason for the inflation is the increased producer prices. You determine the final price of a product – together with VAT, margin and transport costs. These prices would have risen above all in agriculture, a circumstance that would have had a noticeable effect on the prices of goods at retailers such as Aldi, Lidl & Co.

These are joined other factorsas an example puts it well: Jörg Angelé, economist at asset manager Bantleon, explained the background to the particularly sharp rise in the price of some foods – including: dairy products, oils, fats and meat.

For him, the price increases go hand in hand with the development of the milk price, which has almost doubled in the last 18 months. In addition, labor costs have increased in the meat industry with the introduction of the new minimum wage. Collectively, consumers are now feeling the effects of these changes.

Food inflation in an EU comparison: Germany had a low starting level

in the EU comparison the economist pointed out that food prices in Germany have been affected by a very low starting level go out. As a result, inflation has a greater impact. That means: If, for example, a cucumber at Aldi, Lidl & Co. now costs one euro instead of 70 cents as before, the inflation rate is 43 percent. If the price of a cucumber goes up in France from EUR 1.10 to EUR 1.40, the absolute increase in price is the same at 30 cents, but the inflation rate is only 27 percent. That general price level for food is higher in France compared to Germany.

Are you now talking about high percentages in the increase in Food prices in Germany and while trying to compare with EU countries like France, which have lower food inflation this year, it must not be forgotten that these countries within the European Union had an above-average price level in 2021 and Germany a significantly lower one. A meaningful comparison food inflation between Germany and other EU countries is difficult from this point of view.

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