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Ekonomia

Dairy and eggs/sweets increase prices, in December the unpredictable happened

Dairy and eggs/sweets increase prices, in December the unpredictable happened

As overall price growth began to moderate during December 2022, dairy and egg prices posted the highest historical increase of 25.4% compared to December 2021.

INSTAT data show that of the 13 main food groups, dairy and eggs recorded the highest growth. The price of fats also increased with similar rates.

This increase was driven by the higher demand for butter and eggs during the month of December in observance of the tradition of cooking sweets (baklava and health).

Dairy prices that were constantly increasing throughout the year 2022 in December saw an unprecedented increase when in the last days of the month 600 grams of village butter was sold for 1500 Lek.

During December, a kilogram of butter was sold for over 1,600 ALL, as markets often lacked this product. Albania is facing a crisis of regular milk supply. This crisis is coming from the rapid decline in the number of livestock, especially small family farms, and import restrictions, as large farms everywhere in Europe have reduced the number of heads due to the increase in animal feed prices after the war in Ukraine.

In Albania, animal husbandry is going through a crisis due to two basic factors. The first is the demographic transition. The reduction of the population, especially in rural areas, is accompanied by the reduction of livestock. Second, small Albanian farms do not benefit from subsidies and therefore are not profitable.

The rural population is aging and unable to serve animals for self-consumption, farmers are massively selling livestock. This phenomenon is creating a new category of dairy consumers who until yesterday were producers. Dairy is the basis of Albanian gastronomy, but in rural areas it is a basic food.

Livestock farmers warn that this year will be even more difficult if the government does not change the policy of subsidies to help small farms and encourage milk processing in dairies. Albanian livestock is developed in small farms and the processing chain should be like that.

Over the years, investments in milk processing factories are increasing the price of dairy unnecessarily. For example, large milk factories are often put into operation with 20% of the investment capacity, due to the lack of raw materials. Factory costs are the same as if production were 5 times higher. These costs are being transferred to prices, the increase of which does not have a fair share for farmers. While dairy prices have doubled for some products, the price for small farmers increased by 10-15 last year.

The livestock crisis, in addition to bringing a rapid increase in dairy prices, is leading to the extinction of some autochthonous breeds, which produced unique dairy and meat, especially in the Northern areas of the country. /Monitor

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