Filenews 15 October 2021 - by Angelos Nikolaou
One of the largest dairies in the country informed the retailers yesterday about the increase in the price of fresh milk on the market by 3% from November 1. This increase is being given under the pretext of increasing raw materials. This is actually the first increase in the price of milk that will bring about additional price increases in a number of other dairy products, such as yogurt and cheese.
It is noted that the milk industries have recently been burdened with the increased tariffs in electricity and fuel, while the increased cost of purchasing the plastic used for packaging has been added.
As far as the raw material is concerned, there are assurances from cow farmers that they will not proceed immediately, in an effort to keep the prices of halloumi mainly at current levels, due to the closed contracts of cheesemakers abroad, while at the same time there are large stocks of halloumi in the warehouses, which were not disposed of as a consequence of the coronavirus pandemic. Therefore, in the coming months, when farmers in turn move on to the price of raw milk, there is expected to be a further increase in the price of milk and dairy products.
The president of the Consumers' Association, Marios Drousiotis, in his statements to "F", said that there are 5% increases in the housewife's basket, noting however that the increases in the prices of essentials will continue in the coming months and will peak in the Christmas and New Year period. "We're still at the beginning. The increases will continue over the next 3-6 months. The peak of increases in commodities will peak at the end of the year. Then, unfortunately, when I mention it, the low economic strata will be miserably overtaken," he said.
The president of the Association said the amount of the increases cannot be predicted. He pointed out, however, that all those involved in the supply chain have the ability to recover part of the costs, except for consumers. Citing the consumer price index, Mr. Drousiotis said that in September several categories have suffered a large increase, the main one being the category that includes food and juices by 5%, which is the same as the general index. From the beginning of the year until today, he said, there have been increases in bread of 2% in meat with the main one in pork 6% and eggs 4.5%. The price of flour and cereals shows an increase of 4%.
The General Secretary of the Retail Trade Association, Marios Antoniou, confirmed that there are increases in the prices of milk, dairy products, flour, bread and pasta, as a result of the increase in the cost of feed, transport and energy. He added that the increases will be in the range of 15- 20%. He added that signals have been coming from suppliers lately about increases in basic goods, increases he said which will be passed on to consumers as well. An increase of 20% is also expected in animal feed.
Increases, he said, are also expected in the price of meat, noting however that despite what is being said there are units of sheep and goats that are malnourished and if no measures are taken, things will get worse for the livestock world.
On his part, the executive secretary of the Association of Supermarkets, Andreas Hadjiadamou, said that in the food sector the increases will be around 20%. He added, however, that supermarkets are making significant efforts to absorb to some extent the increases due to competition. Mr. Hadjiadamou referred to an unprecedented situation, noting that this is the first time that increases have come in all sectors of economic activity. In almost every product we have increases from suppliers by 20% as a consequence of increases in freight and transport, as well as in energy, fuel and raw materials. He noted that supermarkets are looking at to what extent they can absorb part of the increases. "But it will be difficult to absorb the shocks of the increase," he added, despite the fact that supermarkets, due to the competition between them, are making enormous efforts to contain prices. Competition, he said, works to the benefit of the consumer and there should be no scope for exploitation.
Regarding market shortages, he noted that they are not expected in basic products, but mainly those found in cans such as coffee and fish. At the same time, he underlined that the increased cost of container handling is due to games of multinational companies.
Increases in meat, but not directly
The president of the Butchers' Association, Kostas Livadiotis, said that no increase in the price of meat is expected for the time being. Even if the price of meat rises by 20%, in the pocket of the consumer, it will be imperceptible, he said. Globally, he said, meat prices have risen due to grain, but Cyprus is an isolated island and it is difficult to export either meat or live animals.
According to Mr. Livadiotis, the pandemic and the lack of tourism reduced the demand for meat in the domestic market, resulting in the containment of prices. He added, however, that once the animals are fed with feed supplied at a more expensive price, once the quantities of animals gathered on the farms and marketed become clear, the prices of meat will also increase.
Exercises on paper for compensation to livestock farmers
Scenarios to find the right formula for the compensation to be given to farmers as a result of increases in feed prices, are being worked out by the Ministry of Agriculture. The aim is to give compensation to farmers so that they do not bear the cost of the huge increases of up to 50% compared to the same period last year. At the same time, the ministry invites those farmers who face a problem with the nutritional needs of its animals to communicate with the Ministry of Agriculture to ensure the delivery of feed in consultation with the traders. Feed importers have given assurances that there is no problem on the market and can meet the needs of farmers if for any reason they are deficient. The Association of Flour Manufacturers of Cyprus clarifies in a statement that the members of the Association maintain in their stocks sufficient quantities of cereals for human consumption, in order to supply the Cypriot market with flour unhindered and take care of their timely replenishment so that there are no shortages in the near future.
