She pointed out that during Covid-19 and the beginning of the war in Ukraine, food prices in the world rose very, very fast.
“This is because the world order had changed, both in life and in business. While we are getting used to the new order, everyone is in despair, we have to rearrange the logistics, how to bring the sugar, where to get the packaging – it all changed. We learned it all, so since last at the end of 2018 and at the beginning of this year, food prices started to decrease. People say that no, nothing has changed, but it has always been the case that we notice the good less, but we always see the bad and highlight it more,” said Gulbe.
She pointed out that the prices of dairy products have decreased significantly, including milk and butter by almost half compared to the most expensive period. The price of sunflower oil has also dropped twice. During the year, sugar, flour, eggs and poultry also became cheaper. Coffee, tea, bananas and olive oil have become more expensive.
At the same time, Gulbe also noted that the situation changes very rapidly with various natural disasters, such as floods. “As soon as “natural miracles” occur in a region, it has an impact on food prices. It is impossible to predict what will happen in the future, because the situation in the world is changing very quickly. We do not know how the situation of Israel-Iran, Palestine will be resolved, what kind of aid and how quickly will have for Ukraine, it makes a lot of difference,” she said, while adding that if the situation is similar to what it is now, without major shocks, food prices should remain at current levels.
She also noted that, of course, the prices for a group may increase a little, because it is already known that cocoa and chocolate will definitely not be cheaper, since the price of raw materials has risen three times, but this does not mean that all candies should now cost three times more because they are not 100% chocolate.
“I hope that the prices will remain as they are now, with a slight upward trend, because the availability of resources does not remain higher and the green rate also slows it down a bit. The world’s population is growing, but the land areas that can be used for agriculture are not increasing. The new modern technology implementation, automation helps to produce food more cheaply, and also the new scientific achievements of growing food in urban and labs help. These trends are what keep food prices from skyrocketing,” explained Gulbe.
She also pointed out that food prices in Latvia are more influenced by labor force and purchasing power.
“I am both concerned and would like food prices not to fall, because one of the reasons why they could fall is economic recession and stagnation. We are already hearing rumors that the government may have to cut the budget, which means lower wages. I hope that does not happen , and I hope that food prices will not decrease due to the fact that the economic situation has become very bad. I hope that this will not be the case and that prices will generally remain at the current level,” said Gulbe.
She noted that almost no product in Latvia is 100% made from local raw materials. “We can grow something, but the packaging comes from another place, some product ingredients from another place. A lot of things no longer go through the Red Sea, but around the continent, which means it becomes more expensive. Everyone feels it and it makes an impression. The situation in the world is very fragile, unstable and unknown. If everything is as it is today, then in the near future prices should remain at the current level, without sharp jumps in one direction or the other,” said Gulbe.
