The comparison of the data is taken from the report ‘Latest development of food consumer prices in the Eurozone and Spain’, published this Wednesday by . Bank of Spain and the delay in transferring changes in production costs (raw materials and inputs) to the final cost of prices. This phenomenon may explain why the reductions in costs that manufacturers have already noticed have not yet been noticed in-store.
In particular, prices for flour and other grain consumers still maintain high inflation of 36.8%; this still has not reached the ceiling in the case of bread (15.4%) and shows signs of fluctuation in the pasta and couscous category. According to the data handled by the Bank of Spain in its report (from 31% to 19%). The INE data for January and February start to show a reduction in the bread inflation rate (up to 13.2%), which, if confirmed, could already be interpreted as a fluctuation.
“It may take one to two years to transfer the price change in costs to the final price,” the director general of Economics and Statistics at the Bank of Spain said in a statement last Wednesday. Angel Gavilan. Already then, Gavilan predicted some of the results released by the Bank of Spain this Wednesday, confirming that “food prices have not reached the ceiling” in Spain and that the rate of change in the Consumer Price Index (CPI) will increase. predictably in 2023 it will average 12.2%, which will add to the 12% collected in 2022.
milk case
The Bank of Spain’s analysis confirms that, as with the price of bread, the costs affecting prices are decreasing. milk production. Milk production costs in Europe started to rise sharply from spring 2021, mainly due to the recovery in prices.cattle feedThis represents about 60% of the total costs for milk production.
“In this context, for most of 2021 and early 2022, dairy producers faced a significant increase in costs and a decrease in their margins. increase in skewness In the EU”, the Bank of Spain report underlines. In other words, it is more profitable to sell, given the increase in costs. dairy cows less efficient for the use of their meat. Thus, there would be a significant decline in Spain. dairy cow stock Raw milk supplies decreased in both Spain and the EU in 2022 and 2022.
As a result of the increase in cost and the decrease in raw milk supply, origin selling prices of milk It increased significantly from the end of 2021, reaching all-time highs at the end of 2022 both in Spain and in the EU as a whole. “In the context of moderation in animal feed costs and energy costs, this rise in prices in the last months of 2022 reflects a certain delay in translation of the cost increases recorded since mid-2022,” confirms the Bank of the Bank’s analysis. Spain.
Finally, these increases in prices recorded in the early stages of milk production and the consequent industrial dairy products reflected in the consumer prices of processed dairy products such as yogurts and cheeses. In addition, these products were also affected by the increase in other costs affecting the production and distribution processes. For example, in the case of milk, bottling and packaging cost represented about 20% of production costs in 2021 (MAPA, 2021). increase in energy cost.