Food prices in Europe will rise by another 4-5% in 2023

Food prices will continue to rise, but the growth rate will slow down. This year, food price inflation rate in the region is at 10.9%. Next year, according to STATEC forecasts, it will be half as much. But the institute does not yet see the prerequisites for lowering prices.

In October of this year, food prices jumped 1.7%. This is the biggest increase recorded during the month since 2007. Prices for butter and other oils, fresh vegetables, and frozen fruits increased the most this year.

STATEC experts cannot predict exactly which products will see the biggest price increase in 2023.

There are three main reasons for the rise in prices:

• Europe has been hit by droughts this year;
• Ukrainian grain was blocked in ports for several months;
• The energy crisis has made important petrochemical fertilizers more expensive.

Tom Haas, head of modeling and forecasting at STATEC, is confident that all three causes will affect the region less in 2023. Energy prices have reached a ceiling. Ships with grain from Ukraine again freely transport the resource around the world. Droughts are seasonal and are unlikely to recur two years in a row. Together, these factors will cause the inflation rate to decrease and food prices to rise less rapidly.