Numerous food retailers in Germany have announced price reductions for their dairy products. However, the easing in milk prices could be short-lived.
The prices for dairy products in Germany are falling. The discounter Aldi announced this week that it would permanently reduce the prices for over 50 products such as milk, cream or yoghurt by up to 15 percent from today. The price for a liter of UHT milk or fresh whole milk from Milsani’s own brand is to drop from 1.15 euros to 99 cents.
Aldi is not the only grocer currently lowering its prices for dairy products: At the Kaufland chain, more than 350 products will be cheaper from today because raw material prices have fallen. Edeka and Netto Marken-Discount also announced that they would reduce prices “to a comparable extent”.
Will other groceries also become cheaper?
According to the Dairy Industry Association, the fact that the prices for dairy products have started to slide is due to the current large supply of milk in Germany and Europe. In view of the high prices last year, many farmers increased production, said the association’s general manager, Eckhard Heuser.
The price cuts in dairy products are also likely to have an impact on other food prices. Dairy products are considered so-called corner price items. Customers have their prices in mind when shopping – and they use them as a guide.
Own brands in particular are becoming cheaper
However, it is unclear to what extent the prices will fall: retail expert Robert Kecskes from the market research company GfK considers falling food prices to be rather unlikely across the board: “What you can currently see is that retailers are making price reductions for their own brands,” says Kecskes.
To make matters worse: the easing in milk prices could only be short-lived. According to the trade journal “Lebensmittel Zeitung”, dairies expect prices to rise again from autumn. “We are heading towards an undersupply,” said the chairman of the Dairy Industry Association (MIV), Peter Stahl, to the newspaper. The CEO of Sachsenmilch Leppersdorf, Mathias Hauer, also expects milk prices to go up again from autumn.