EU Food Prices Up by 7.1% Year-On-Year in April 2008

03/06/08 Since the end of 2006, but particularly since July 2007, food prices in the EU have increased more rapidly than overall inflation. The same pattern was observed for the euro area. In April 2008, the annual increase in food prices in the EU was 7.1%, compared with 3.6% for overall inflation, as measured by the all-items HICP. In the euro area, the annual increase in food prices was 6.2%, compared with 3.3% for overall inflation.

March and April 2008 recorded the highest annual increases in food prices in both the EU and the euro area since the beginning of the series in 1996. However, between 1996 and April 2008, food prices have risen in total at a similar rate to overall inflation: +31% and +27% respectively in the EU, and +30% and +27% respectively in the euro area.

These figures come from Eurostat, the Statistical Office of the European Communities.

Annual increases of food prices ranged from 3.2% in Portugal to 25.4% in Bulgaria.

The weight of food in the all-items HICP reflects the share of food purchases in household consumption expenditure. This share is 14.6% at the EU level. The weight of food in the index varies from 9.5% in the United Kingdom and 9.7% in Luxembourg, to 34.5% in Romania and 23.2% in Lithuania.

In April 2008, the highest yearly increases in food prices were found in Bulgaria (25.4%), Latvia (21.7%), Estonia (18.3%) and Lithuania (18.1%). The lowest increases were registered in Portugal (3.2%), Netherlands (5.4%), France (5.5%), Cyprus (5.8%) and Italy (5.9%).

The impact of food prices on overall annual inflation depends on both the weight of food in the all-items HICP and the annual price changes for food, and therefore differs significantly between Member States. The largest upward impacts from food prices on overall annual inflation in April 2008 were found in Bulgaria (+3.4 percentage points), Lithuania and Romania (both +1.9 pp), while the smallest upward impacts were recorded in Portugal (+0.1 pp) and Luxembourg (+0.2 pp).

Among the nine food classes, the three main classes at EU level are meat, bread & cereals and milk, cheese & eggs. They make up 60% of the food component. In April 2008, the annual price increase in the EU was 14.9% for milk, cheese & eggs, 10.7% for bread & cereals and 4.1% for meat. For the remaining food classes, price changes ranged from -1.2% for vegetables to +13.2% for oils & fats.

In April 2008, among the Member States, annual price increases for meat ranged from 0.7% in Portugal to 19.1% in Lithuania, for bread & cereals from 6.3% in the Netherlands to 38.4% in Bulgaria, and for milk, cheese & eggs from 3.4% in Cyprus to 35.4% in Estonia.