In the 2022/2023 season, average retail prices of fruits and their preserves and vegetables and their preserves will be significantly higher than in the 2021/2022 season, the Institute of Agricultural and Food Economics (IERiGŻ) predicts in a report. As a result of the increase in retail prices, consumption of horticultural products and their preserves will be lower in the 2022/23 season than in the previous season. This will primarily affect consumers from households with relatively low incomes.
Significantly higher than in the 2021/22 season will be the average retail prices of fruits and their preserves and vegetables and their preserves. In October 2022, compared to October 2021, the average retail prices of fruits and their preserves were 14.7% higher. Prices of fruit preserves increased by 25.4%, and fresh fruits by 14.6%. The average retail prices of fresh vegetables increased by 18.3%, and of processed vegetables by 14.9%. In the months of January-October 2022, the average retail prices of fruits and their preserves increased less than those of food and non-alcoholic beverages compared to the same period last year. As a result of the increase in retail prices, consumption of horticultural products and their preserves will be lower in the 2022/23 season than in the previous season. This will primarily affect consumers from households with relatively low incomes. In these households, the income, but also price, elasticity of demand is much higher than in households with relatively high incomes, according to the report “Fruit and Vegetable Market. State and prospects.”
In 2022, compared to the previous year, purchase prices for plums headed for the fresh produce market increased, while purchase prices for cherries and strawberries decreased. Purchase prices for cherries, strawberries, black and red currants, gooseberries and chokeberries increased in purchase for processing. However, purchasing prices for raspberries decreased from their record high in 2021. In the 2022/23 season, buying prices for dessert apples will be higher compared to the previous season, while buying prices for apples headed for processing will not change significantly. The increase in the prices of most fruit going to processing was due to the increase in production costs on horticultural farms, but also to the increase in export prices of processed fruit (mainly concentrated juices and frozen foods) and the weakening of the zloty against the euro and other currencies. The weak zloty allows for higher export revenues calculated in Polish currency and offering higher prices to raw material suppliers. In the 2022/23 season, purchase prices of most vegetables, but also those grown under covers, will be higher than in the previous season. Buying prices of onions headed for both direct consumption and processing will increase the most. In 2022, only the prices of cucumbers and tomatoes will fall compared to the previous year.
In the 2022/2023 season, the share of direct consumption in the distribution of fruit may reach 28% compared to 29% in the previous season. The share of exports will fall from 19 to 17, and supplies for processing will increase from 52 to 54%. In the disposition of vegetable supply, the share of deliveries for processing will be, as in the 2021/22 season, about 45%, exports will increase from 13 to 14.5%, and direct consumption will fall from 42 to 40%, it was also indicated.
In the 2022/2023 season, prices in all links of the marketing chain in the horticultural sector are significantly higher. This is due to increased production costs at fruit and vegetable farms and processing companies. The increase in production and transportation costs has also increased prices in international trade in agri-food products, including horticultural products. It is estimated that the increase in purchase prices will be less than production costs in the current season, which will result in a deterioration of the economic condition of horticultural farms. The financial performance of fruit and vegetable industry enterprises may also deteriorate. In the first half of 2022, the financial indicators of companies in this industry deteriorated compared to the first half of 2021, although they allowed “safe” performance of their activities.
Source: IERiGŻ and ISbnews
