What products will rise in price in Russia in 2022
Food inflation is gaining momentum and does not intend to subside. According to First Deputy Prime Minister Andrei Belousov, Russia will face a new wave of global price increases in 2022 due to rising food prices. This will be especially noticeable in the second half of next year. He noted that such negative dynamics are a consequence of the macroeconomic imbalance due to the coronavirus pandemic. Spot freezing of food prices, agreements with producers and export duties on certain types of food did not have a positive effect. On the contrary, the actions of the authorities only destabilized the already difficult situation on the food market. Experts told what prices consumers will see on store shelves next year.
Belousov predicted a new wave of global inflation in 2022 due to the rise in food prices: “We are now going through the second wave of inflation, and obviously there will be a third,” said the First Deputy Prime Minister.
In November, we recall that annual inflation accelerated to the maximum since January 2016 of 8.4%. Food inflation, which includes food and alcoholic beverages, is almost a third higher at 10.81%. The main driver of price growth was fruit and vegetable products. In particular, this year the potato harvest in Russia has faced serious problems due to bad weather. As a result, the cost of potatoes has grown by 15.5% since the beginning of the year, according to Rosstat. But the current prices, if you believe the words of Andrey Belousov, are just flowers.
The acceleration of inflation was influenced by a set of reasons. The authorities like to nod at an external factor – imported inflation. Indeed, prices in the food and commodity markets in the world have risen markedly this year and continue to rise. This happens because most of the developed countries in the acute period of the pandemic pumped a lot of money into the economy, says Igor Nikolaev, Doctor of Economics. Other external factors – global disruptions in supply chains, high energy prices: all this is also a consequence of the pandemic and lockdowns. The growth of inflation is also influenced by internal factors. “All forecasts for the rise in prices have already been beaten. The authorities played with directive methods of price regulation: export quotas, freezing the cost of sugar and sunflower oil did not help. Another chronic problem of the Russian market is the insufficient level of competition, ”the expert notes.
Artificial market regulation is not an option, agrees with the economist, Director of the Center for Agri-Food Policy of the RANEPA, Doctor of Economics Natalya Shagaida. According to her, the same freezing can have a positive effect, but in the short term. “If during the freeze the prices on the external market or the prices of resources for production inside the country continue to grow, then after the restriction is lifted, there will still be a jump in value. And very painful, – she emphasizes. – It is impossible to restrain prices for a long time, because either imported products will not be delivered (this will become unprofitable), or domestic producers will go bankrupt due to the rise in the cost of resources. Then there will be a shortage of food. ”
Shagaida is convinced that a decrease in import duties can smooth out the rise in prices. “This is partly what the government is doing. There is also a world practice when VAT is reduced, – continues the interlocutor of “MK”. – If people’s incomes grow, then the reaction to the rise in prices will not be so sharp. In 2015-2016, food inflation was higher, but people did not react that way. A decrease in the administrative burden will also have a positive effect on prices. Now it would be useful to abandon additional requirements for the manufacturer, for example, mandatory labeling, which increases their costs and, as a result, prices on the shelves. “
In Russia, people already spend more than 50% of their income on food, recalls Dmitry Vostrikov, executive director of the Rusprodsoyuz association. “It is no longer possible to increase this percentage, because other obligatory payments are on the second side of the scale: utility services, transport costs, medicines. You cannot fight inflation with just one product. This leads to the fact that the rise in price moves further. For example, sugar prices were limited, but all confectionery products rose in price. It turns out that people save on one product, and overpay for another. Targeted support to the needy segments of the population can help. This method really works, ”the expert said.
According to Igor Nikolaev, cereals and grains will rise in price to a lesser extent next year. “Fruit and vegetable inflation has distinguished itself this fall. Potato prices were breaking records. Growth will continue in 2022. The same will happen with meat and dairy products, he said. – At the end of this year, inflation will be 8-8.5%. In 2022, the indicator will be closer to 10%. ”
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