Competition Council: Shelf prices of basic foods rose by an average of 1.53 percent in August

  The shelf prices of basic food products, except for seasonal fruits and vegetables, increased by an average of 1.53 percent in August compared to June, staying below the threshold associated with the VAT increase, according to an analysis conducted by the Competition Council based on data from six major retail chains.According to the centralized data, non-seasonal products which recorded price increases above the VAT increase are the following: minced meat (+4.93 percent), yeast (+3.11 percent), yogurt (+2.75 percent), bread (+2.78 percent), sponge cake -cozonac (+18.40 percent), eggs (+1.85 percent), sour cream (+4.35 percent), sugar (+5.45 percent) and butter (+4.03 percent).At the same time, shelf price decreases were reported for the following categories: bone-in pork leg (-2.52 percent), boneless pork leg (-2.03 percent), pork shoulder (-2.19 percent), margarine (-3.77 percent), garlic (-3.51 percent), flour (-1.9 percent), beans (-0.69 percent), tomato paste (-0.14 percent) and rice (-0.09 percent).In the seasonal goods category (fruits and vegetables), more pronounced changes were recorded. Thus, prices dropped for plums (-61.34 percent), watermelon (-46.17 percent), grapes (-41.38 percent), Bianca peppers (-31.92 percent), Kapia peppers (-22.01 percent), potatoes (-30.75 percent) and onions (-32.74 percent), but increased for cucumbers (22.03 percent), Golden apples (21.98 percent) and red apples (22.25 percent).According to the Competition authority, the prices of food items in the consumer basket, which includes both seasonal and non-seasonal products, decreased on average by 4.18 percent in August compared to June, mainly because of the significant drop in prices for summer fruits and vegetables."As expected, the prices of seasonal products have decreased. Regarding the prices of other daily consumer basket items, we observed increases below those resulting from the VAT adjustment, which means that major retailers and their suppliers absorbed part of the increase in August. This shows that the market and competition are working, as companies are fighting to keep their customers with attractive prices. In fact, food prices rose less than non-food products or services. We will continue to monitor the prices of basic food items, which are influenced not only by the VAT increase but also by other factors such as fuel and electricity prices. Beyond this inflation peak, the rise in prices in Romania is the result of a large budget deficit, and in order to ensure price stability we must stick to the deficit reduction timeline," President of the Competition Council Bogdan Chiritoiu said.The analysis was conducted based on data provided by six major retailers (Auchan, Carrefour, Kaufland, Lidl, Profi and Selgros) and includes basic food products subject to the Government's Emergency Ordinances (OUG) capping commercial markups (OUG 67/2023, OUG 89/2023 and OUG 5/2024). These regulations establish temporary measures to curb excessive price increases for 46 categories of basic food items and are in force until September 30, 2025.The VAT rate for basic food products increased as of August from 9 percent to 11 percent.