Prague - Food prices keep raising all over the world, due to high oil and fuel prices combined with weather problems which caused bad harvest in Russia, Ukraine, Australia and Argentina. It is even believed that high prices helped to provoke recent protests in Tunisia and Egypt.
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According to the UN Food and Agriculture organization, the food price index is at its highest point in 21 years, even higher than it was in 2008 during the food crisis.
In the Czech Republic, growing global prices of cocoa, corn or coffee has already taken effect, causing an increase in retail prices of sweets and some pastry. More price hikes of basic food products, such as bread, are expected in March.
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Prices of sweets are increasing because Kraft Food, a US producer, reacted on growing costs of cocoa, milk, coffee and corn by globally increasing prices of its product. Sweets constitute an important article in the Czech Republic, as 10.5 million Czechs spend CZK eight bil (EUR 320 mil) for sweets every year.
"The increase in commodity prices is really high and nobody will avoid raising their prices," said a businessman unwilling to be named because of ongoing negotiations with food retail chains which try hard to keep the prices low.
Even the Czech Statistical Office data confirm the trend. The price of chocolate and chocolate products grew in January 2011 by 2,8 percent, the price of non-chocolate sweets by 3.3 percent. Prices of bread and some other pastry has already increased by 10 percent, the office said, due to growing flour prices.
Two largest players in the Czech bakery industry, United Bakeries and Penam, have already announced they are going to increase their prices. Pastry producers say that current prices are not sustainable.
"The pressure is so enormous that we will have to raise the prices. Generally it should be something around 10 percent," said Marko Pařík, the general director of United Bakeries, to Týden, a Czech weekly.
