We have to get used to prices staying high

According to an analysis prepared by Zoltán Fórián, head of division in Agrár Európa Kft. for Éfosz, substantial price rises will dominate the world market of food in 2007 and higher prices are likely to stay with us in the long run. Though globalisation had kept food prices low for several years, they began to rise faster than the average consumer price index at the end of 2005 and this trend seems to be a permanent one. Consumer prices generally grow faster than suppliers’ prices paid by retailers, which means that a profit is generated for the retail business. This year, suppliers are raising their prices at a rate that is nearly identical to the rate of growth in consumer prices. Agricultural prices are expected to grow faster in the second half of the year than the prices of the food industry. The prices of agricultural produce are expected to continue rising at an accelerating rate for the next 2-3 years. The rising price of agricultural products will lead to rising prices for food processing industries, though there will be differences between these.