Scarce Remaining Budget for Essential Food Items: Basic Groceries Are Surprisingly Affordable
In recent times, some staple foods have become more affordable due to factors such as abundant seasonal supplies, good harvest conditions, and reduced demand. This shift in prices partially eases the burden on low-income consumers, but rising prices in other categories still strain their overall food budget.
The FAO Cereal Price Index dropped 0.8% in July 2025 compared to June, and is 3.8% lower than last year. This decrease is attributed to ongoing good harvests and high export availability. Similarly, rice prices have continued to fall due to ample exportable supplies and weak import demand.
However, prices for other food categories like meat, eggs, vegetable oils, and nonalcoholic beverages are rising significantly. For instance, eggs grew 16.4% in price over the previous year, and beef and veal increased 11.3%.
Contributing factors to this price rise include weather-related supply disruptions, tariffs affecting trade flows, higher energy costs, labor market tightness, and stronger consumer demand for certain items.
The impact on consumers below the poverty line is mixed. Lower prices for staples can provide some relief since these foods often form the largest share of their diet, helping maintain basic caloric intake affordability. However, the overall rise in prices for protein sources (meat, eggs), oils, and processed foods can erode nutrition quality or force consumers to substitute toward cheaper but less nutritious foods, worsening food insecurity and health outcomes.
Food price inflation at 2.2–3% year-over-year, although lower than historical averages, still gradually tightens limited food budgets, causing families below the poverty line to shift spending habits and stretch resources.
While the price decrease in staple foods like grain, milk, and sugar provides relief, many families continue to live below the poverty line and may have to forgo basic necessities due to food costs. Some popular foods, such as cocoa, coffee, and meat, have seen significant price increases, which continues to be a challenge for many households with limited budgets.
Despite the price decrease in some staple foods, the overall cost of living in the country remains high. A bag of sugar now costs only 89 cents, down from 1.49 euros during the corona period, and a bag of rice now costs only 89 cents as well. However, cheese remains expensive due to high demand in the Middle East and Asia.
The decreased prices of grain, milk, and sugar may provide temporary relief for those struggling with food affordability, but experts have not provided any reassurance that many foods will remain affordable in the future. As a result, many families in the country are currently facing a dilemma between luxury items and essential food due to limited household budgets.
In conclusion, the divergence in staple versus other food prices reflects underlying agricultural market conditions and economic factors. While cheaper staples can somewhat alleviate pressure, the broader pattern of rising food costs continues to challenge economically vulnerable consumers.
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