Despite EU price regulation, it still happens that the same products are sold on the Austrian side of the border at significantly higher prices than in Germany. On average, the price difference is 13 percent, experts calculate. And that with the already substantial price increases of the past few months.
The sharp rise in food prices is already affecting consumers. A calculation by experts now shows that many everyday products are sold at even higher prices in Austria than, for example, in neighboring Germany. Reasons for this may otherwise be expensive or cheaper trade and supply chains, which is also reflected in the price that the end customer pays, according to the economic researchers at the Center for Economic Policy Research.
“Marginal effect” in food prices
In the region around the German-Austrian border, you actually see a “border effect” for supermarkets. Prices are uniform within the country. And this despite the fact that the EU already sets not only quality but also price standards for many goods.
In Germany, experts from credit insurer Allianz-Trade have now observed ‘excessive profit-taking’ by the food companies. The sharp increase in food prices is not only due to the increase in raw material costs and energy prices and has made a noticeable contribution to food inflation over the past year, according to Allianz Trade inflation expert Andy Jobst, the dpa.
“Hungry for Profit”
“There seems to be increasing evidence of profit-taking and insufficient competition in areas with particularly high price increases, such as producers of dairy products and eggs, as well as non-seasonal fruit and vegetables,” said an insider. Jobst said more than a third of Germany’s price increases in recent months cannot be attributed to traditional factors such as raw material costs or energy price developments.
“We notice that food producers in particular are hungry for profit. They have raised prices much more than the retailers,” says industry expert Aurélien Duthoit of Allianz Trade. The experts at Allianz Trade do not expect the price increases for food to come to an end anytime soon.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
