Price hikes in milk, bread as producers blame global supply crisis

Prices of staple food products – including bread, butter and other dairy products – have increased sharply as local producers try to cover costs that have been spiraling due to the global shortage of raw materials and freight expenses brought about by the coronavirus pandemic.

Both Malta Dairy Products, the company that produces Benna dairy products, as well as the bakery Golden Harvest said they had to increase prices to cover costs from January.

The most recent increase in prices was flagged in a Facebook post by Nationalist MP Jason Azzopardi who wrote that anyone buying essential food items would have noticed “large increases in wheat and dairy products”. 

He said the weekly €1.75 increase in cost of living adjustment – COLA was not enough to cover people’s basic needs and went on to list increases, ranging from 10c to 83c, in flavored milk ranges, fresh cream, yoghurt and butter.

The price of basic dairy milk has not increased.

When contacted, Malta Dairy Products Limited said the company had managed to keep the prices of its fresh milk products stable over recent months, during which the costs of feeds on the international markets, as well as other operational, logistical and raw material costs had significantly increased.

“As of the 1st January 2022, MDP has adjusted the prices of some of its products,” it said.

“This decision has been taken after the company has absorbed the increase in costs for a number of months.”

It said the company would continue to aborb the extra costs relating to fresh white milk “considering that such a product is an essential consumed daily by Maltese and Gozitan families.”

The company said that the price adjustment was also necessary to sustain the local dairy industry.

No profit

Similarly, a spokesperson for Golden Harvest said that, just like other local bakeries had raised their prices at the end of 2021, the company was forced to up the prices in January to cover costs.

“We have been trying to absorb the costs and delayed increasing prices at the end of the year not to burden consumers. But we had to cover our costs. I assure you that the price increase does not reflect the increase in prices of raw materials which we have been experiencing due to the pandemic. We are in no way making more profit, we are just covering some of the costs,” a spokesperson said.

She explained that the raw materials included flour, yeast, sugar and packaging.

Over the past year, prices have shot up across the board.

Supermarkets and suppliers have reported seeing some “super increases” in prices due to fattened-up freight costs, with COVID-19 and Brexit to blame.

Suppliers have explained this was a global situation brought about by a wide array of factors impacting the supply chain.

These include cargo container shortages, congested shipping ports, employee shortages and increased costs for freight and raw materials.

Food prices are pushing inflation up, with the National Statistics Office saying that the annual rate as measured by the retail price index was at 2.38% in November, up from the 2.31%  in October.

The highest annual inflation rates in November 2021 were registered in food (4.50%).

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