Hungary Newsflash Week 45

Eco-conscious trend on the upswing but beef consumption figures also increasing, food inflation, and the promise of a plentiful fall fishing season - The week in Hungarian agriculture

Healthy vegetables at a grocery store.
Beeld: ©Scott Warman
As inflation continues, food prices are also constantly rising. By October 2021, core inflation in Hungary rose by 4.7% y-o-y, and consumer prices had risen by 4.6%. Compared to the same period of 2020, food prices had increased by 5.2%.

Beef consumption slowly increasing in Hungary

The economic news portal Világgazdaság has recently reported on the state of Hungary’s beef sector. According to the news site, 1987 was a record year with a per capita consumption level of 10.7 kilograms, while in 2013 this figure reached its lowest point at 2.2 kilograms. Current estimates project a 4.5-5.0 kg per capita per year beef consumption in the coming years in Hungary.

However, domestic production has to compete with import beef coming from Brazil, Argentina, Ireland and Poland. There is also a variance in the quality of available products. While imported beef is more expensive than cheaper beef varieties in Hungary (coming from discarded dairy cattle), it is still cheaper than prime meat coming from domestically grown beef cattle.

According to beef farmers there are various issues that the sector faces today. It was told that the issue is with the high price level of beef. In a time when food inflation is high, the average Hungarian family can’t afford to have steaks for dinner when a slice of prime steak can cost as much as €10.6 to €12.7. However, another farmer complained that consuming quality beef is not something that the populace values in Hungary and the market is flooded with inferior quality beef coming from discarded dairy livestock.

Christmas fish will also be pricier this year

Of course fishing lakes could not escape the ripples of price increase and are following behind the food inflation current but fishing this season is still expected to go swimmingly.

Puns aside, although Hungarians consume less fish than the European average (Hungary: 6.7 kg/capita, EU average: 24-25 kg/capita), a large portion of that annual consumption falls into the winter holiday season. Traditional fish dishes, especially fisherman’s soup, are integral to the Christmas eve dinner of a Hungarian family and this year, due to the increasing prices of feed, fish prices will in turn follow.

Carp is usually the most consumed fish and also the cheapest, but its per kilogram price will be higher than €2.8 in the winter season. As the fall fishing period is underway, fish farmers report that due to the summer drought, the populations of bream and perch are lower this year. But carp will be plentifully available. Another rising trend for Christmas dinner is catfish.

Hungarian grey cattle herd grazing in a pasture.
Beeld: ©István Asztalos
Hungary's iconic cattle breed, the Hungarian Grey, grazing on the Great Plains. Beef consumption numbers are now moderately rising in Hungary but domestically produced prime meat coming from meat cattle has a hard time competing with imported beef.

Inflation continues, consumer prices rising

As inflation in Hungary continues, consumer prices including food prices are constantly on the rise according to the latest economic figures by the Central Statistical Office (KSH). In January-October 2021, consumer prices rose by an average of 4.6%. In October core inflation was 0.9% m-o-m and 4.7% y-o-y.

Compared to the same period of 2020, the price of food increased by 5.2%. Behind this aggregate value, certain food item prices increased more than others. The food inflation was 30.4% for cooking oil, 18.8% for margarine, 12.5% for flour, 10.1% for workplace catering, 9.3% for poultry meat and 8.4% per cent for pastries. The price of bread rose by 8.1% and in total catering prices rose by 7.9%. Compared to September 2021, food prices rose 0.7% on average

In the larger economy, inflation caused by higher consumer prices will have a definitive effect on agribusiness operations and investments. Automotive fuel prices rose by a steep 30.7% and building improvement and maintenance item prices increased by 13.9% compared to the same period in 2020. Between September and October 2021 alone, automotive fuel prices increased by 7.3%.

Alcoholic beverage and tobacco prices rose by an average of 11.3%, of which tobacco products alone were 17.6% more expensive.

In fact the price of automotive fuel has reached €1.403 this fall. That is not a round figure – In euros. In Hungarian Forints however, that value marks the point where the per liter price of fuel finally went above HUF 500 – Which many news outlets have defined as a “psychological boundary” for the populace, in effect, a milestone in the rate of inflation, which Hungary has now passed.

Comsumers’ eco-consciousness increasing

We have recently reported on the results of a recent survey which showed that Hungarian consumers are becoming more eco-conscious.

Now another survey seems to confirm this trend, although it seems that consumers have not yet tailored their behavior to all environmental considerations.

The new survey, which was conducted by the company Reacty Digital Kft., involved 500 adult responders. The results show that 56% of consumers would choose higher-quality, more durable products even if they are more expensive, and 54% said that in all aspects of life, they are trying to behave environmentally consciously. However, only 12% would avoid buying a product if they believed it was not environmentally friendly. Yet it seems that Millenials and Gen Z are improving the statistics: In the age group of adults under 30, this percentage was 22%. (So the figures are not that good yet, they are just somewhat better. Baby steps.)

Responders also highlighted the reasons for which they would not purchase certain products, and recurring answers were that lacking information of the product or lacking information on how far it had traveled would be a definitive discouraging factor in its purchase.

The authors of the survey concluded that even e-commerce companies should now start acting on these shifts. They encourage online vendors to use eco-friendly packaging and delivery and to advertise their eco-conscious choices because Hungarian consumers are now reacting very positively to these policies.