The dynamics of price increases continue to rise, as evident with each passing month. In August, daily shopping costs increased by 4.3% year-on-year. This time, almost all of the 17 categories, bar one, witnessed a positive trend. An analysis of more than 86,000 retail prices also showed that non-alcoholic beverages topped the list of the most expensive products with a year-on-year increase of 10.2%, followed by sweets and desserts – 9.3%. Aside from that, there were considerable shifts among the most expensive categories. Unexpectedly for the summer season, fruits and vegetables also joined the list, with prices up by 9.1% and 6.3% respectively. Household chemicals rounded off the top five with a result of 5.3%. Furthermore, even fats which had been falling for months saw an increase. Only bulk goods posted a negative result, decreasing by 3.9%.
According to the latest report by UCE RESEARCH and the WSB University Merito titled “RETAIL STORE PRICE INDEX”, daily shopping costs in August rose on average by 4.3% year-on-year. In July, the year-on-year increase, calculated using the same methodology, was 3.9%, and in June – 3.1%. Thus, the dynamics of price increases continue to rise. Out of 17 monitored categories, 16 saw an increase while only one dropped. In the previous three months, each time 13 segments were up, and 4 held back.
“With each passing month, our purchasing power weakens. This is primarily due to the return of the base VAT rate on selected food. Moreover, the shaping of store prices is heavily determined by rising production costs, wages, and energy and fuel prices,” says Dr. Robert Orpych of WSB University Merito.
In August, non-alcoholic beverages became the most expensive for the second time in a row, this time up by 10.2% year-on-year. The previous increase was 15.6%. “A sweltering summer boosted demand for drinks. Producers and vendors cashed in on this, knowing that customers would first and foremost want to quench their thirst, not analyse the price. It is the weather, coupled with an increase in production costs, that will determine how the prices of non-alcoholic beverages behave in the coming months,” comments Dr. Artur Fiks of WSB University Merito.
The second spot is held by sweets and desserts, which previously ranked third in the price increase list. Nevertheless, they became as expensive in August as they did in July, namely by 9.3% year-on-year. “This category has been under price pressure for quite some time, due to expensive raw materials, including cocoa, as well as the energy-intensity of the production process,” asserts Dr. Eng. Anna Motylska-Kuźma of the University of Lower Silesia DSW.
While the first two categories aren’t surprising, there are clear shifts in the further positions. Fruits have entered the top 3 with a year-on-year increase of 9.1%, and they were previously outside the top 5. By comparison, in July they increased by 3.8%. “Spring frost, summer heatwaves, floods, inundations, and hailstorms have destroyed crops. This has reduced supply and increased production costs, which in turn bumped up the final price. This will particularly increase in the fourth quarter of 2024 and the first quarter of 2025,” analyses Dr. Eng. Anna Motylska-Kuźma.
Another “novelty” in the top 5 are vegetables, which were previously outside the top 10. They most recently rose by 6.3%, and a month earlier became cheaper by 5.6%. In June they also showed a negative trend. “During the summer, fruits and vegetables are usually cheap, but this year they have emerged among the most expensive categories. For farmers, months of heat, lack of rain and drought, with relatively frequent hailstorms, mean losses in crops,” believes Dr. Robert Orpych. In addition to this, experts from UCE RESEARCH add that during the holiday season, the retail chains themselves were not too keen on offering promotions on said categories, hence regular prices had to go up.
In the ranking, the fifth spot is taken by household chemicals with an increase of 5.3%. In July, they were fourth in the presentation with a rise of 8.7%. “The pace of price increase for products in this category is clearly decreasing. However, this situation will not last long. Energy and gas price increases can raise the costs of production and shopping in stores,” warns Dr. Artur Fiks.
Outside the top 5 and taking the sixth position is bread. In August, it rose by 5.2%, and a month before – by 6.4%. At that time it was in the fifth place. “The cost of purchasing bread is mainly due to energy and raw material prices, including flour. The first of these factors is under constant pressure, and the second remains relatively stable. However, there is a lot of uncertainty in the markets, due to the situation in Ukraine, weather conditions, and energy and fertiliser costs themselves. That’s why bread prices sometimes go up and sometimes down,” observes Dr. Eng. Anna Motylska-Kuźma.
Positive changes have also been noticed in the fish category, with a year-on-year increase of 4.4% (previously – 2.8%), meat at 4.2% (a month earlier – 2.2%), and cold cuts – 3.6% (previously 2.3%). “The cost of producing meat and cold cuts in the summer can be lower thanks to access to pasture and cheaper feed. But this slightly reduced the price increase resulting from the hike in electricity and gas charges,” notes Dr. Artur Fiks.
In August, dairy prices also increased – by 4.1% (in July – by 3.6%). In the rising categories, we can see stimulants (i.e. tea, coffee, beer, and vodka) with a price increase at the level of 2.6% (previously – 1%), children’s items – 2.2% (3.5%), and personal hygiene products – 1.7% (a month earlier – 6.2%). Moreover, pet foods increased in price by 1.5%. In July, they were 0.5% down.
“In the case of many categories, including personal hygiene items and pet food, we are dealing with a base effect. Last year’s huge price increase means that we now see a real slowdown in rises. The relative stability could have been disrupted by changes in energy charges in July, but this effect is not yet strongly felt. Meanwhile, the prices of children’s items have reached a level that society finds acceptable, after the high jumps at the beginning of the year, associated with the increase in benefits paid for children,” explains the expert from the University of Lower Silesia DSW.
Further in the ranking are food additives with a year-on-year increase of 0.6%. In July, they were second in the list of most expensive items. At that time, prices rose by 11.2%. “The dynamics of price increases have drastically slowed down. It seems that producers and sellers already incorporated the increase in gas and electricity charges into the prices of food additives in July. Lowering the pace of price increases will probably reduce the risk of a drop in demand for products from this category,” explains Dr. Artur Fiks.
The least increase was observed in fats, by only 0.4%. However, here we should take into account the fact that this category had been down for quite a long time. The last, July’s decrease was 8.1%. “I would treat the result of August as a slight deviation from the general trend, which does not change the decreasing direction. Fats had been getting much more expensive over the years. After reaching the peak, the situation began to stabilise,” convinces Dr. Robert Orpych.
In the negative zone are only bulk products (including sugar, flour, and salt). They became cheaper by 3.9%. A month earlier, they noted a decrease by 7.4%. “The situation could soon drastically change, as grain and plant yields will decrease in some regions of the world due to weather anomalies. Even products that will not be affected by weather problems may quickly get more expensive because they will be treated as substitutes for the most expensive items,” summarises Dr. Artur Fiks of WSB University Merito.
Research Method Description
The data comes from the recurring report, “RETAIL STORE PRICE INDEX” (compiled monthly for almost 7 years), authored by UCE RESEARCH and WSB University Merito (formerly Higher Banking Schools). The analysis shows the average price value noted month-on-month and year-on-year. In the latest issue, the results from August 2024 were compared with those from the same period in 2023. This covered 17 categories and more than 100 most common everyday consumer products. In total, over 86 thousand retail prices from over 40.3 thousand shops belonging to 61 retail chains were compared. The research encompassed all discounters, hypermarkets, supermarkets, convenience stores, and cash & carry’s reaching the majority of consumers in Poland.
Source: https://managerplus.pl/ceny-w-sklepach-nie-przestaja-rosnac-widac-tez-mocne-przetasowania-wsrod-najbardziej-drozejacych-kategorii-62621
