Inflation: Sugar, flour and cheese: why prices are skyrocketing

Inflation seems to have peaked in Germany, at least for the time being.

Inflation: Sugar, flour and cheese: why prices are skyrocketing

Inflation seems to have peaked in Germany, at least for the time being. For individual foods, however, consumers have to dig deep into their pockets - such as wheat flour, sugar, semi-hard cheese or potatoes. Their inflation rates also shot up late in the year.

Sugar, for example, was only 1.6 percent more expensive in September than in the same month last year. Inflation skyrocketed to over 42 percent in October and as much as 63 percent in December. Also with wheat flour, potatoes and cheese, the increases came late rapidly.

Price increases reach the customer with a time lag

"When the trade buys from the food industry, it usually happens with temporary contracts for half a year or a whole year," said Udo Hemmerling, deputy general secretary of the farmers' association. "That's the reason why price increases for flour and sugar, for example, only appear on the shop counter with a time lag." The good news is that some prices should more or less last into the summer. However, other foods, such as butter, are negotiated on a monthly basis. As a rule, there are no long-term contracts for potatoes either. Here, the meager harvest was responsible for the sharp rise in prices.

It's a bit more complicated with sugar. Here, for example, prices could also fluctuate if the food trade had to buy more on the spot market, said Günter Tissen, general manager of the Sugar Economic Association. "But we can cover the vast majority of our sugar requirements in Germany from local agriculture," said Tissen. And here the prices are usually subject to long-term contracts. However, the decision as to what price consumers ultimately have to pay remains with retailers.

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