Food price caps in Hungary: here is the most important date
According to the decision in force, the food price caps “will be in force until 30 April”, the Ministry of Agriculture said in response to a question from ATV. The Economic Competition Office (Gazdasági Versenyhivatal) is investigating whether the food price hike may have been caused by a breach of competition law.
Price caps to stay until 30 April
According to the decision in force, the food price freeze will remain in force until 30 April, the Ministry of Agriculture said in response to a request from ATV. The Hungarian TV channel received this answer after asking the ministry whether the food price freeze would be on the agenda of the next government meeting and whether the cabinet would consider lifting it before the April deadline.
“The Economic Competition Authority is investigating the food retail market sector to see whether competition law infringements or distortions of competition may have contributed to the surge in food prices,” the ministry said.
ATV contacted the Ministry of Agriculture with their questions after Péter Benő Banai, Minister of State for Public Finance, said at the Budget Committee meeting on Monday that the government and the central bank agree that the price freezes should be lifted, the only question is when.
When price rises normalise, caps will be abolished
On top of that, in an interview with Index, Agriculture Minister István Nagy said last week that the food price cap is a specifically social measure, so the moment consumer price rises start to return to normal, the measure can be phased out.
As you know, last year the government extended food price freezes until 30 April 2023 for granulated sugar, wheat flour, refined sunflower oil, domestic pork legs, chicken breast, chicken breast, chicken backs, chicken tail, chicken wings, ultra-high temperature treated milk with 2.8 percent fat content, eggs and table potatoes.
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Source: atv.hu, index.hu
Price caps result in shortages and at the same time are inflationary. Last week I was shopping at Lidl and there was no 2.8% UHT milk anywhere. So, I bought some other kind, at twice the price. If a chicken farmer cannot sell the eggs at market price in Hungary, he will ship them to somewhere else where he can. No wonder why so many businesses close. If a business cannot make a profit, it will shut its doors.