Already under pressure, Irish consumers could see even higher prices for staples such as fish and dairy in their weekly shop over the coming weeks, according to new data from the Central Statistics Office (CSO).
Released on Monday, the latest wholesale price index shows Irish food producers charged retailers and other intermediaries 10.8% more for their products in July than a year earlier and 2.2% more than in June.
Food made the largest contribution to the overall ex-factory price index for products sold domestically, which rose 9.5% since July 2021 and 2.4% since June, the largest increase monthly since at least 2015.
Up 3.2% in July alone, prices for Irish dairy farmers have soared nearly 53% in the past 12 months, the figures show. Fish prices, meanwhile, rose 10.9% in July and 19.7% since July last year.
Released earlier this month, the CSO Consumer Price Index for July showed Irish households were paying 9.6% more for a basket of consumer goods than a year earlier.
Jillian Delaney, a statistician in the CSO’s pricing division, said retailers might be able to absorb those extra costs for a while, but eventually pass them on to consumers in the form of higher prices if the increases continue. maintained over time.
Food prices also tend to be volatile from month to month due to seasonal effects such as weather patterns as well as speculation in global commodity markets.
However, underlying the increase in dairy and ex-factory prices in general is the sharp rise in wholesale energy costs, which continued to accelerate in July, adding to the additional costs of energy-intensive activities such as milking and manufacturing.
Energy prices were already rising around the world before the invasion of Ukraine in late February, which threatened Russia’s natural gas supply.
Wholesale electricity prices – the prices paid by energy retailers in the single electricity market for Northern Ireland and the Republic before supplying it to homes and businesses – increased by 86, 3% per year and 47% from June to July. Utility companies have passed these price increases on to consumers in the form of higher bills over the past year.
However, Ms Delaney said how and when consumers start to see these increases depends on the decisions made by electricity retailers. Last year, significant increases in wholesale energy prices – driven primarily by the rebound in global demand for natural gas as economies reopened – took several months to show up in monthly household bills.
On a more positive note for consumers and retailers, wholesale gasoline (up 21.9% since July 2021) and diesel (up 31.4% since July 2021) prices fell respectively 4% and 3.5% from the previous month, consistent with a drop in global oil markets over the summer.
Wholesale building material prices, however, were 20.6% higher at the end of July than a year earlier.
In its July Purchasing Managers Index for the construction sector, released last week, BNP Paribas Real Estate Ireland said there was evidence that the rate of increase in materials prices, although high, may have peaked in the summer months.
CSO figures indicate that the price of some wood products, including treated wood, has more than doubled in 12 months, while prices for steel and reinforcing metals have jumped 46.7% in over the same period and by more than 10% in July alone.