Prices have moved. How and why products have become more expensive in the past year
In St. Petersburg, as well as throughout Russia, products are becoming more expensive. Potatoes have risen in price almost 2 times in a year, the cost of meat, butter and vegetables has increased significantly, there is nothing to say about cereals. What is happening with the food market of the Northern capital and what to expect for the citizens in the new year - in our material.
Is the climate to blame?
The fact that food prices are rising is not news for a long time. Against the background of the general rise in price, some positions are sharply knocked out of the leaders every year. This was the case with buckwheat in 2019, which was gradually followed by other cereals, with sunflower oil and sugar in 2020. The current year was marked by a rise in the cost of potatoes: already in January, Rosstat noted a 40% change in the average price of this root crop. Beets and carrots followed the potatoes.
St. Petersburg does not stand out much on this path: over the year, the cost of potatoes has grown from 31.91 rubles to 49.26, carrots - from 32.76 to 43.5. And this is the average price according to Petrostat calculations, products on the shelves of stores, as a rule, are more expensive. Beef, butter, eggs and buckwheat have also risen significantly in the Northern capital this year. In general, the increase occurred for all products from the official list of socially significant essential goods.
Experts call the changed weather conditions one of the reasons for the rise in price of vegetables. In the Leningrad region and St. Petersburg, for example, the nature of precipitation has changed in recent years: both snow and rain have become much more in one unit of time than before. Already in 2020, vegetables were harvested in local farms by almost 10% less than in previous years, and the situation did not improve last season. And the pre-crisis volume of growing the same potatoes on Leningrad land was insufficient to meet the needs of such a large region.
"The number of St. Petersburg is more than 5 million people, it is the second largest metropolis in Russia. If we multiply this number by the average per capita annual consumption of potatoes at the level of 60 kg, it turns out that Petersburgers need at least 330 thousand tons of root crops per year. And the Leningrad region, according to the Ministry of Agriculture, produces about 76 thousand tons and is not even among the 20 leaders of production in Russia. It turns out that the rest of the volume comes from other regions, including from remote Tyumen, Bryansk, as well as from Belarus. These logistical costs affect the cost of the product. Another feature of St. Petersburg is the dominance of online retail. According to our estimates, retail chains account for about 80% of the retail market. They are basically what form the situation on the shelves. Even in Moscow, this indicator is still at the level of 65%," Alexey Krasilnikov, executive director of the Potato Union, told AIF.
It will be more expensive
Pricing forecasts for next year are also not comforting. Experts agree that residents need to prepare for the rise in price of the grocery basket. High inflation rates, the weak ruble exchange rate, and the global food crisis are to blame for this.
"The two main sources of price increases in 2022 that can be predicted right now are labeling and logistics, especially the "last mile" (the final stage of delivery when goods are sent to the end consumer, - ed.). In the new year, dairy products and packaged water (drinking, carbonated, with sweeteners and flavorings, etc.) will become mandatory for labeling. And although it seems that this is not much, in fact, the entire range will rise in price. After all, if a company introduces end-to-end labeling control for 10% of its sales (for example, milk), it cannot raise prices only for it. This makes the offer for these categories uncompetitive. Therefore, the increase is for all goods: from chips to sausage. In addition, some manufacturers and sellers who do not have such a capacity to increase shipping prices or free capital are leaving the market. This leads to a decrease in competition and, again, to an increase in prices in the entire segment," explained Nikolay Novoselov, a representative of the distribution market, Cuore Development Director.
In the case of St. Petersburg, economist Vasily Koltashov believes that allowing small producers to enter the market in a free mode - right on the streets – would help to stimulate competition in the food market. "If, along with large sellers, small and medium-sized ones appear on the market in large volume, it will be possible to achieve at least price preservation. But the decorative implementation of such a plan will not give effect. In Moscow, for example, this is implemented in the form of a weekend market and by and large does not bring down any prices, especially since standard dealers trade there. But a well-constructed trade liberalization could help," the expert notes.
Olivier Index
One of the ways to measure the cost of a New Year's holiday table is the so-called "Olivier Index". Rosstat even considers this indicator. However, this year the agency has not yet updated the data, so the calculations were taken by "AIF". The editorial board used official Petrostat data and average prices in local retail chains. And the recipe was taken as a basis, according to which the statistical authorities find out the index of the most popular New Year's salad.
As a result, "Olivier" in 2021 will cost St. Petersburg residents about 10% more than last year, which is also a kind of indicator of the overall increase in food prices.
By the way
Changes in weather conditions affected not only the volume of the harvested crop, but also its quality. For example, it is now difficult to find selected large-caliber potatoes on the shelves, and even for sane money. The Potato Union even had to negotiate with retail chains so that they would lower their requirements for the size of the product and let the shredded potatoes onto their shelves.
Is the climate to blame?
The fact that food prices are rising is not news for a long time. Against the background of the general rise in price, some positions are sharply knocked out of the leaders every year. This was the case with buckwheat in 2019, which was gradually followed by other cereals, with sunflower oil and sugar in 2020. The current year was marked by a rise in the cost of potatoes: already in January, Rosstat noted a 40% change in the average price of this root crop. Beets and carrots followed the potatoes.
St. Petersburg does not stand out much on this path: over the year, the cost of potatoes has grown from 31.91 rubles to 49.26, carrots - from 32.76 to 43.5. And this is the average price according to Petrostat calculations, products on the shelves of stores, as a rule, are more expensive. Beef, butter, eggs and buckwheat have also risen significantly in the Northern capital this year. In general, the increase occurred for all products from the official list of socially significant essential goods.
Experts call the changed weather conditions one of the reasons for the rise in price of vegetables. In the Leningrad region and St. Petersburg, for example, the nature of precipitation has changed in recent years: both snow and rain have become much more in one unit of time than before. Already in 2020, vegetables were harvested in local farms by almost 10% less than in previous years, and the situation did not improve last season. And the pre-crisis volume of growing the same potatoes on Leningrad land was insufficient to meet the needs of such a large region.
"The number of St. Petersburg is more than 5 million people, it is the second largest metropolis in Russia. If we multiply this number by the average per capita annual consumption of potatoes at the level of 60 kg, it turns out that Petersburgers need at least 330 thousand tons of root crops per year. And the Leningrad region, according to the Ministry of Agriculture, produces about 76 thousand tons and is not even among the 20 leaders of production in Russia. It turns out that the rest of the volume comes from other regions, including from remote Tyumen, Bryansk, as well as from Belarus. These logistical costs affect the cost of the product. Another feature of St. Petersburg is the dominance of online retail. According to our estimates, retail chains account for about 80% of the retail market. They are basically what form the situation on the shelves. Even in Moscow, this indicator is still at the level of 65%," Alexey Krasilnikov, executive director of the Potato Union, told AIF.
It will be more expensive
Pricing forecasts for next year are also not comforting. Experts agree that residents need to prepare for the rise in price of the grocery basket. High inflation rates, the weak ruble exchange rate, and the global food crisis are to blame for this.
"The two main sources of price increases in 2022 that can be predicted right now are labeling and logistics, especially the "last mile" (the final stage of delivery when goods are sent to the end consumer, - ed.). In the new year, dairy products and packaged water (drinking, carbonated, with sweeteners and flavorings, etc.) will become mandatory for labeling. And although it seems that this is not much, in fact, the entire range will rise in price. After all, if a company introduces end-to-end labeling control for 10% of its sales (for example, milk), it cannot raise prices only for it. This makes the offer for these categories uncompetitive. Therefore, the increase is for all goods: from chips to sausage. In addition, some manufacturers and sellers who do not have such a capacity to increase shipping prices or free capital are leaving the market. This leads to a decrease in competition and, again, to an increase in prices in the entire segment," explained Nikolay Novoselov, a representative of the distribution market, Cuore Development Director.
In the case of St. Petersburg, economist Vasily Koltashov believes that allowing small producers to enter the market in a free mode - right on the streets – would help to stimulate competition in the food market. "If, along with large sellers, small and medium-sized ones appear on the market in large volume, it will be possible to achieve at least price preservation. But the decorative implementation of such a plan will not give effect. In Moscow, for example, this is implemented in the form of a weekend market and by and large does not bring down any prices, especially since standard dealers trade there. But a well-constructed trade liberalization could help," the expert notes.
Olivier Index
One of the ways to measure the cost of a New Year's holiday table is the so-called "Olivier Index". Rosstat even considers this indicator. However, this year the agency has not yet updated the data, so the calculations were taken by "AIF". The editorial board used official Petrostat data and average prices in local retail chains. And the recipe was taken as a basis, according to which the statistical authorities find out the index of the most popular New Year's salad.
As a result, "Olivier" in 2021 will cost St. Petersburg residents about 10% more than last year, which is also a kind of indicator of the overall increase in food prices.
By the way
Changes in weather conditions affected not only the volume of the harvested crop, but also its quality. For example, it is now difficult to find selected large-caliber potatoes on the shelves, and even for sane money. The Potato Union even had to negotiate with retail chains so that they would lower their requirements for the size of the product and let the shredded potatoes onto their shelves.
