Food prices rising faster in Belgium

20th February 2008, Comments 0 comments

The price of food in Belgium is rising faster than in neighbouring countries.

The price of food in Belgium is rising faster than in neighbouring countries. This has been confirmed by a study commissioned by the ING bank. The researchers question the profit margins of the wholesale and retail sectors.

The prices in Belgium have risen three times faster over the last year than the average.

The cost of processed food increased by 8.5% last year. The European average was an increase of 5.5%.

The annual inflation rate in Belgium is now 3.5%. This figure is comparable to the other European Union member states. Noteworthy however is that food makes up such a large share of the inflation figure.

The reason for the considerable price increase is not clear. The higher prices of energy and raw material have had an impact, but this impact is the same in the other European countries. It is possible that the food sector in Belgium is taking a larger profit margin.

According to Yvan Van de Cloot of ING an audit of the food sector is overdue. "The Central Bank had promised just such an audit," says Mr Van de Cloot.

"Dutch shops are selling at a loss"

Fevia, the food industry federation, admits that the price of processed foods in Belgium has increased faster than in the neighbouring countries.

According to Fevia this is because the supermarkets are passing the higher price of raw material directly on to the consumer. Chris Morris of Fevia says that in the Netherlands, the wholesalers have passed the higher price of raw material on to the retailers, but they have kept their prices stable and are selling at a loss.

Fedis, the federation of distributors disagrees with Fevia. "The sector specific costs, for example for food safety, are much higher in Belgium; the Belgian ecotax is unique in Europe, and the wage costs are higher in Belgium than in our neighbouring country," points out Fedis spokeswoman Pascal Deboosere. 

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