Food baskets are €13.40 more expensive than a year ago. Heck price has risen to almost 5 euros – Executive Summary

Last year, the price of the food basket of 63 basic commodities monitored by DECO PROteste rose by €13.40, representing an increase of 6.11 percent. On June 19, 2024, the cost of this basket of products was 232.72 euros. In comparison, on June 21, 2023, the cost was €219.32. Fresh hake was the product that rose the most in percentage terms, with an increase of 66 percent, at a cost of 11.80 euros per kilo, 4.69 euros more than last year.

Products with the largest price increase
Between 21 June 2023 and 19 June 2024, in addition to fresh hake, other products that registered significant increases include extra virgin olive oil (more than 27%). Last week, from June 12 to 19, the products that saw the biggest price increases were sliced ​​mature cheese (plus 15%), onions (plus 14%) and spiral pasta (plus 13%).

The list of the ten products with the highest increase is the following: fresh fish (66%), extra virgin olive oil (44%), tuna in olive oil (33%), oranges (27%), dried garlic (22%), sea bream. (19%), horse mackerel (14%), cooking beef (13%), cauliflower (13%), and Flemish cheese slices (10%).

The Russian invasion of Ukraine had a major impact on the agri-food sector. Ukraine was an important supplier of grains to the European Union, including Portugal. This crisis was exacerbated by the consequences of the epidemic and drought. Limited supplies of raw materials and high production costs, especially fertilizers and energy, led to higher prices in international markets. This had an impact on consumer prices for products such as meat, fruit and vegetables, breakfast cereals and vegetable oils throughout 2022.

The continued rise in consumer prices, especially food prices, contributed to the inflation rate rising to historic levels in 2022. However, in early 2023, the inflation rate began to slow. According to the National Institute of Statistics, the inflation rate decreased in December 2023 to 1.4 percent. However, at the beginning of 2024, it rose again. In May 2024, the inflation rate reached 3.1%, up from 2.2% recorded in April.

The impact of the expiration of zero value-added tax on the price of the basket
To contain the rise in food prices, on March 27, 2023, the government signed an agreement with the retail food production and agricultural food sector, stipulating that a basket containing more than 40 types be exempt from value-added tax in the period between April 18, 2023 and January 4. 2024. The list of products that do not include VAT was prepared based on the recommendations of the General Directorate of Health and included the foods most consumed by Portuguese families.

Since the end of the VAT exemption, on January 4, the price of the food basket containing 41 basic products has decreased by 19 cents (0.13 percent less), from 141.97 euros to 141.78 euros on June 19. According to DECO PROteste, the products whose prices have risen the most since the end of zero VAT are tuna in olive oil (30%), apples (14%) and sea bream (13%).

Since January 2022, DECO PROteste has been monitoring the development of basic food prices, analyzing the total price of the basket every week on Wednesdays. Data are collected the day before in major supermarkets along with online stores. The process involves calculating the average price of each product available across all stores in the simulator. Next, the sum of the average prices of all products determines the cost of the basket for a given day.