In addition to other local businesses, commercial distilleries are also struggling with the rise in energy prices. However, the surge in expenses is not the only deteriorating factor but also the boom in corner distilleries is making the situation worse. As a result, the price of one of Hungary’s curiosities, pálinka, is also rising. Traders promise not to increase prices more than necessary.
Hungarian pálinka is facing mounting issues
Some of the pálinka distilleries represented by the National Pálinka Council (PNT) have not bought fruit. There are several reasons for this. Some distilleries closed down or reduced their production during the pandemic. For these distilleries, there may be a significant stock of fruit. There are also others where Covid-19 and the recent economic difficulties have had such a severe impact that the orchards do not have a sufficient budget to purchase fruit.
According to László Mihályi, President of the National Council of Pálinka, “the breweries that buy fruit are doing so because their pálinka brewed from the fruit is popular or because they want to launch a new product on the market.” For this reason, some breweries have bought raspberries, blackcurrants and blackberries this year, in addition to apricots. Traditional ingredients such as plums, quince, cherries, gypsy melon and apples were also popular.
The impact of the energy crisis is being felt strongly in the hospitality sector. Many restaurants and hotels are closing permanently or temporarily due to rising energy prices. The future of the pálinka sector is also uncertain, which has an impact on fruit purchases. Another issue is that the purchase price of fruit is also increasing, by roughly 25-35 percent, but in some places, it has even reached the 50 percent threshold.
The cost rises in cookery are also reflected in prices. According to Mihályi, there was a wide variation in the cost increases of the cookers. The good news is that the PNT believes that the increase in pálinka would not exceed a critical level, vg.hu reports. Pálinka distilleries are fully at the mercy of the market.
Ukrainian factories supply 30 percent of Hungarian glass. Two glass factories were hit during the fights. There are also difficulties with taxes and compulsory fees. All these negative factors together justify a price increase of roughly 40 percent. This 40 percent increase has been applied to most food products. However, the price increase will not be as significant for pálinka, as it would lead to a drastic drop in purchasing power, index.hu reports.