Food prices to drop at yearend

Food price increases are expected to slow significantly and start to decrease at the end of this year in Finland. according to the recent agri-food sector outlook of the Natural Resources Institute Finland (Luke).

This can be explained by the decreasing prices of the production inputs required in the food chain, including energy and fertilisers. Producer prices for cereals and oilseed crops have already fallen from the previous year’s peak both globally and in Finland. The consumption and production of meat and dairy products decreased in 2022 and are expected to decrease further in 2023.

In 2022, there were unusual pressures to increase food prices, as the prices of the production inputs in the food chain increased significantly. Fresh fish (31.9%), eggs (25.0%), coffee (37.5%) and flour (28.7%) witnessed the most significant price increases in 2022. Food prices increased by an average of 10.5% from 2021 to 2022. The prices continued to increase steeply at the beginning of 2023. However, Luke expects the prices to start to decrease during the second half of this year.

“Still, average prices in 2023 will be 7–8% higher than in the previous year as a result of the price increases at the beginning of the year,” said Hanna Karikallio, Senior Scientist at Luke.