The shelf prices of ten brands in the consumer goods industry have risen by 27% since May 2008 until now, reveals a ZF survey based on prices displayed in Bucharest hypermarkets and Carrefour online store.
The biggest price increases were registered for milk (59%), poultry (almost 54%) and coffee (42%).
Foodstuffs and non-alcoholic beverages account for 28.3% in Romanians’ monthly budget, so that more than one quarter of Romanians’ income is spent in stores on items such as milk, eggs, bread or water, according to market research company Euromonitor.
On the other hand, Poles spend 14.2% of their salary on food, Czechs 12%, while Germans spend 8.6% on food. At the same time, Romania lags behind in Europe in terms of the average net monthly salary.
Financial analyst Aurelian Dochia believes the price increase phenomenon is due to the trend of prices in Romania falling into line with EU levels.
“I believe this price increase phenomenon will gain momentum in Romania amid a tendency of prices getting aligned to EU levels. There will never be a complete price overlap even in older members of the EU,” said Dochia. At the same time, he believes taxation moves did not have a negative impact over foodstuff prices.
In May 2008, the price of one liter of Cedra (Napolact) milk stood at RON3 in Bucharest stores and has now reached almost RON4.8 in Carrefour’s online store, rising by almost 60%. By comparison, one liter of Floriol vegetal oil is a little over RON6 cheaper, after a 22% price cut from May 2008. As a matter of fact, vegetal oil is the only item among the 10 analyzed by ZF whose price is lower than six years ago.
Marius Bicu, managing partner at Unilact Transilvania, the producer of De la Ferma dairy, explains that EU integration reflected into milk shelf prices as the EU imposed certain farm hygiene and animal health standards. Contracts with retailers also had an impact.
“I believe that 10% of milk price increase during this period, and this is also valid for foodstuffs in general, came from the commercial terms set by supermarkets each year,” states the entrepreneur, who expects the milk price increase to decelerate once milk quotas are done away with.
Milk prices were also pushed upwards by the rising prices of fuel and implicitly of transport costs.
At present, the price of a Borsec mineral water bottle stands at RON2.18 in Carrefour’s online store, 32% more than in the first half of 2008, according to ZF’s food index. Transport accounts for 15-20% in the price of a water bottle.
At the same time, the price of one kg of packaged chicken from Transavia rose by almost 54% during the analyzed period, to almost RON12.
Grigore Horoi, president of Agricola Bacau, a major player on the chicken market, previously explained that chicken price increases were due on the one hand to the VAT hike, but also to the high mark-ups applied by hypermarkets.
Coffee also saw its price rise, by 42%. “Coffee is entirely imported, so that prices depend on what happens on the bourse and on the exchange rate and the Romanian currency has fallen in recent years,” says Aurelian Dochia.
(English version by Catalina Apostoiu)