Did you feel the drop in food prices? No, we didn’t either.
Food prices declined sharply in June compared to June, especially of sugar, milk and dairy products, thanks to an increase in the supply and improved production prospects, announced the UN’s Food and Agriculture Organization (FAO). The price index of a basket of basic foodstuffs dropped by 3.7 percent in July compared to the previous month, with the highest decline recorded in prices of milk and dairy products, particularly butter and cheese, which fell by 6.6 percent compared to June. Grain prices also fell noticeably by 3.6 percent compared to June, reports Novi List on August 13, 2018.
However, Croatia did not see any decline in food prices mentioned by the FAO. This includes the price of butter, whose price jumped abruptly to around 25 kuna last autumn, while about a year ago it cost about 17 kuna. The record price of butter was explained at the time as a result of the lack of milk on the market. Interestingly, now that the milk production has risen, there has not been any significant decline in the price of butter, which costs about the same as six months ago.
The current average producer price of butter on the EU market is 555 euro per 100 kilograms, which is five percent less than in the same period last year, according to the Croatian Chamber of Commerce (HGK). Given that the production price of butter is still high, the HGK says it is unlikely that retail prices will be drastically cut in favour of consumers.
Dalibor Janda from CroMilk – the Association of Croatian Milk Processors – offers a similar explanation. He says that the price of butter on the market has fallen, but adds that it is difficult to detect it in stores because butter and related products are often offered on sale. He admits that there has been no noticeable drop in consumer prices.
If the current producer price of butter on the EU market is 555 euro per 100 kilograms, this means that the producer price of a 250-gram “cube” of butter is about 10.5 kuna, while its selling price in Croatian retail shops amounts to between 20 and 25 kuna, which is more than double the producer price.
Translated from Novi List (reported by Bojana Mrvoš Pavić).