Experts warn of inevitable food price hike in stores

Food prices in stores are set to rise inevitably, experts warn. This is driven not only by higher energy costs but also by a significant increase in fertilizer prices. Since Russia's invasion of Ukraine and Belarus's restrictions on fertilizer exports, fertilizer prices in Europe have soared, becoming one of the biggest challenges for farmers.

In response, the European Commission plans to mobilize €540 million to help farmers cover rising costs. However, the sector is already warning that this amount is likely insufficient. The exact support for each member state will be known only in July. Meanwhile, Latvia's Ministry of Agriculture is working on proposals for the European Commission, aiming to secure more favorable funding distribution terms for Latvia.

The increase in farmers' costs will eventually be reflected on store shelves. More expensive fertilizers, fuel, and other raw materials drive up food production costs, and the impact will be felt for a long time, even if the geopolitical situation improves. Industry representatives argue that EU support alone cannot ease the pressure and call for extending the reduced VAT rate, set to take effect in July, to other food product groups to mitigate price increases.