Hungarian prices beat Scotland and Spain
Striving to display the cheapest possible prices, a Hungarian news portal made a thorough comparison between the cost of grocery items in Scotland and Spain and the ones in Hungary, where the amount of money spent on foodstuff nearly doubled since 2015.
Szeretlekmagyarorszag.hu examined food prices in Scotland and Spain, from banana to egg and sugar to cola, and compared them to the costs of Hungarian grocery items.
Hungarians living in border settlements can save up to HUF 40,000 (EUR 101.9)a month by going shopping in neighbouring countries. The reason behind this is that annual food inflation in Hungary was 49 percent in December, compared to 29 percent in Slovakia and 23 percent in Romania, according to the World Bank.
Two Hungarians living abroad reported on the prices in Scotland and Spain. In the former, a cheap discount chain’s, and in the latter, a mid-range chain’s prices were observed.
Once the prices had been standardised – since the products are not standardised in terms of packaging, number of items, weight and currency – striking conclusions were drawn.
Is shopping cheaper in the West?
Let’s see the prices of the most basic foodstuff that can be found in every household, eggs.
- Hungary – HUF 100 (EUR 0.25)/piece
- Scotland – HUF 65 (EUR 0.15)/piece
- Spain – HUF 50 (EUR 0.13)/piece
UHT milk was a product that was commonly missing from supermarket shelves, firstly, due to COVID-19, secondly because of the Russian-Ukrainian war and, thirdly, for the continuous inflation.
- Hungary – HUF 370 (EUR 0.94)/1 l
- Scotland – HUF 270 (EUR 0.69)/1 l
Granulated sugar is another staple that has become scarce as a result of panic puying. Due to the price freeze, although there are divergent views on that, the price of this foodstuff remained more or less stable for a long period of time.
- Hungary – HUF 240 (EUR 0.61)/1 kg
- Scotland – HUF 410 (EUR 1.04)/1 kg
- Spain – HUF 520 (EUR 1.33)/1 kg
The price of dairy products, such as sour cream, kefir, cheese but also fruit yoghurt, has recently skyrocketed in Hungary.
- Hungary – HUF 185 (EUR 0.47)/1 can
- Scotland – HUF 60 (EUR 0.15)/1 can
- Spain – HUF 120 (EUR 0.30)/1 box
It is debatable what percentage of meat content in a sausage is considered edible, but the cheapest one clearly contains the least meat. Nevertheless, even those products saw a sharp price hike.
- Hungary – HUF 1,000 (EUR 2.55)/half kg
- Scotland – HUF 1,100 (EUR 2.80)/half kg
- Spain – HUF 510 (EUR 1.30)/half kg
Since the prices of all of its ingredients, such as eggs and flour, went up, the cost of spaghetti pasta also soared.
- Hungary – HUF 420 (EUR 1.07)/half kg
- Scotland – HUF 120 (EUR 0.30)/half kg
- Spain – HUF 290 (EUR 0.74)/half kg
Coca-Cola is one of the things which can be considered relatively cheap in all three countries.
- Hungary – HUF 610 (EUR 1.55)/2 l
- Scotland – HUF 1,120 (EUR 2.85)/2 l
- Spain – HUF 810 (EUR 2.06)/2 l
However, the price of bananas is double in Hungary compared to Scotland.
- Hungary – HUF 670 (EUR 1.71)/1 kg
- Scotland – HUF 305 (EUR 0.78)/1 kg
The rustic baguette also experienced a two-fold increase.
- Hungary – HUF 1,440 (EUR 3.67)/1 kg
- Spain – HUF 590 (EUR 1.50)/1 kg
Having said all that, a tray of wrapped chicken breast fillets costs more or less the same at home and in the Mediterranean country.
- Hungary – HUF 2,000 (EUR 5.10)/1 kg
- Spain – HUF 1,920 (EUR 4.89)/1 kg
Hungary hit by biggest price increases
Eurostat statistics show that food prices have risen more in less developed countries since 2015 than in countries with stronger economies. The data demonstrate that Hungary has beaten all other countries in the region when it comes to price increases, followed neck and neck by Slovakia and Romania, wrote piacesprofit.hu. Hungary’s agriculture used to be an area we could all be proud of in terms of competitiveness, but that’s a thing of the past.
In economically more advanced countries such as Croatia and Austria, food inflation is not even at EU levels, based on the harmonised index of consumer prices of the last 8 years. If we look at product prices rather than harmonised consumer prices, the increase has more than doubled since 2015 in Hungary.
Read alsoCentral and Eastern Europe’s largest virtual film studio to be built in Hungary
This is how much food prices have risen in Hungary since 2017
Customers still shake their heads in disbelief at how much prices have risen in the last few years. If we compare supermarket promotional leaflets from 2017 with recent ones from 2023, it is astonishing to see how prices have skyrocketed in the past five years.
Szeretlekmagyarország.hu compared a 2017 promotional leaflet with a recent one, and the difference is striking. The author of the article presented identical or similar products in two flyers, one dated 30 January 2023 and the other dated 17 August 2017.
“I was delighted when I recently came across a SPAR promotional leaflet from 2017 when decluttering. However, my smile quickly frosted over and I almost fell off my chair when I saw how little dairy products, vegetables and pasta cost back then,”
wrote the “lucky” finder of the leaflet.
It is mind-boggling to think that just a couple of years ago, adding a clutch of cocktail tomatoes or a kilogram of Trappist cheese to our shopping basket did not feel like a luxury. You could mix up a simple cheese and cream pasta relatively cheaply, rather than spending nearly as much on the ingredients as if you had ordered it in a restaurant.
Striking price differences
A 330-gram Magyar tejföl sour cream cost HUF 219 (EUR 0.57) in 2017 and HUF 995 (EUR 2.58) in 2023. A liter of 2.8 percent Magyar tej milk cost HUF 299 (EUR 0.78) in 2017, while now it is HUF 449 (EUR 1.16). The same brand’s 450-gram cottage cheese is now HUF 1,759 (EUR 4.55), which means a 4.2-fold increase compared to 2017 figures.
The price of a kilogram of Trappist cheese varies between HUF 4,800-7,000 (EUR 12.44-18.15), depending on the brand, but the price differences are striking with most types of cheese. In 2017, a kilogram of Trappist cheese on sale amounted to HUF 1,339 (EUR 3.47), now it cost more than double.
Within five years, the price of a clutch of cocktail tomatoes has risen from HUF 299 to 1,299 (EUR 0.78 to 3.37). However, the prices of other vegetables have also increased dramatically. A kilogram of cabbage now costs HUF 398 (EUR 1.03), which is 3.3 times more than in 2017. A piece of hot pepper was HUF 34 (EUR 0.088) in 2017, which is now 4.4 times more. A kilogram of red potatoes was HUF 99 (EUR 0.26) in 2017, now it is sold for HUF 295 (EUR 0.76) with a price cap.
While in 2017, customers paid HUF 849 (EUR 2.20) for 900 grams of minced pork, it is now available for HUF 1,629 (EUR 4.23). Spar Danish salami has also doubled in price. Barilla’s half-kilo penne rigate pasta was HUF 399 (EUR 1.04) back then, today its price tag shows a three-fold increase.
“There must be a number of products whose prices have not risen at such a shocking rate in the last five years. But unfortunately, we haven’t spotted any,”
concluded szeretlekmagyarország.hu.
More people get cheap gas in Hungary
The government is enabling universities run by asset management foundations and companies owned by ethnic minority authorities to opt for fixed gas prices, rather than paying indexed prices, the energy ministry said late on Wednesday.
The fixed prices will be in place until the end of September, the ministry said.
So far, the option has been open only to state, municipality and church institutions.
Bodies originally targeted by the scheme will have to decide by Friday. The deadline for those newly included is Feb 2.
Although international gas prices are much lower now than they were last year, the market is still plagued by uncertainty, the statement said. The scheme aims to help institutions in making their utility costs more calculable, it said.
Read alsoEuropean gas price cap ‘dangerous, harmful’
Removal of food price caps expected in Hungary
Traders diverted the profits from price-capped products to other goods. This has caused the price of non-price-capped items to skyrocket. The removal of the price caps will be very painful for the public, as shops will not decrease their prices even after the price caps are removed.
László Parragh, President of the Hungarian Chamber of Commerce and Industry (MKIK), said in an interview with Index.hu that the time had come to plan for the removal of price caps. According to Index.hu, at the moment, this is a key economic policy task.
“The Hungarian economy has reached a turning point. Positive signs are already visible, even if not all companies are directly aware of this at the moment,”
the President of the Chamber of Commerce and Industry pointed out.
The necessary conditions for the removal of price caps are already beginning to emerge. These conditions include favourable inflation and the forint exchange rate, as well as economic growth and a decline in consumption. According to Pénzcenturm.hu, Parragh said that in the future the forint would strengthen further and inflation would peak in a month or two, so this year will prove to be easier than the previous one.
Worsening shortages
In December 2022, the Hungarian government published that they extended the price caps until 30 April 2023. Nearly all the price-capped products enjoy great popularity among consumers. The increased demand, however, causes shortages and results in empty supermarket shelves.
According to Péter Virovácz, senior analyst at ING, the price cap has become unsustainable.  The government should make the decision to remove the price caps swiftly before they trigger even bigger problems.
In our earlier article, we analysed the complex issue and the possible effects of the removal of the price cap. In the harsh business environment, non-price-capped products, to which the deficits from the price cap have now been transferred, would not be cut back once the price cap is removed.
The price cap clearly has a market-distorting effect. Virovácz acknowledged that it had helped Hungarian families, but a shortage emerged. If the government removes the price caps, the re-inflation of products is expected to slightly boost inflation. However, this increase of around 0.2-0.3 percent will not compensate for the current deliberate price increases on other products.
Mariann Trippon, a senior analyst at CIB Bank, agreed that the price cap was market-wrenching and harmful. “On top of the deteriorating shortage phenomenon the long delays make things even more difficult, so I’m sure the government will remove it soon,” she said to Pénzcentrum.hu. There is now a likelihood of getting rid of the price cap since trade cannot sustain this situation for long. Consumers will only face further shortages if no change will occur.
“There is a realistic chance that we can say goodbye to the price caps shortly instead of April as originally announced.”
Anyway, Gergely Gulyás, the prime minister’s chief of staff said this Thursday that food price caps might be maintained as long as they did not generate shortages, adding that the government was planning to maintain that regime until April 30.
Socialists propose reducing VAT on basic foodstuffs
A gap of more than ten percent exists between the pension increase and inflation, and VAT on basic foodstuffs should be reduced to zero, a Socialist politician said on Friday. Official statistics show that the inflation rate based on the consumer basket of pensioners was 26.5 percent in December, Lajos Korozs, the party’s deputy leader, said at an event streamed on his Facebook page. Meanwhile, retirees are receiving a 15 percent pension increase, meaning that pensioners “will again be lending to the government for months”, he added.
More than 1.1 million pensioners live on monthly pensions of 80,000-160,000 forints (EUR 202-404), he said, calling on the government to reduce VAT on basic foodstuffs to zero percent and that on household energy to 5 percent.
Potato and pork need foreign import, but pig slaughtering on the rise
According to the agronomist, consumers need to stock their pantries with potatoes and meat products, especially pork. Although both products, even from this month will need foreign import, the number of pig slaughtering is increasing.
In need for foreign import, disappearing Hungarian products
Earlier, we have already wrote about the lack of Hungarian potatoes on the market. The complete disappear of the product means that consumers must pay more for the imported goods, since it is purchased by euros and includes the price of transportation, with skyrocketing fuel prices. Even if there were Hungarian potatoes, most farmers would sell them on foreign markets for euros, which would increase their profits.
According to the agronomist György Raskó, the price of pork will increase by 80 percent, mostly because of the price caps, said he to Napi.hu. The consumer price of these basic foodstuffs is fixed, but once domestic stocks run out, the much higher wholesale import price is likely to cause significant deficits to retailers. Since supermarkets and shops have deficits on the products with price caps, they must increase the prices of other non-price-cap groceries.
Price cap plays a role
In December 2022, Hungarian government published that they extend the price caps until 30 April 2023. All the products with price caps are popular among consumers. This popularity causes the shortages in the shelves of shops.
According to Napi.hu, The Hungarian National Trade Association recently asked the government to remove the food price caps immediately. The trade association believes that the measure is not achieving its goal and does not seem to have reduced inflation in food prices.
In our earlier article, it is clearly visible that the effects of the removal of the price cap is a complex problem. The harsh business environment would ensure that the non-price-capped products, to which the deficits from the price cap have now been transferred, would not be cut back once the price cap is removed. In the end, consumers will face a higher price level for groceries after the price cap than they would have if there had been no price cap at all.
At the same time, there must already be around a thousand small shops that are making a steady loss. These shops are unable to finance the difference between the purchase price and the consumer price, unlike supermarkets.
The reason behind the increasing number of slaugtering
The growing demand for quality meat products resulted in the increasing number of slaughtering, growing year by year. The pig population in Hungary is not increasing, so consumers rely on foreign meat products once domestic stocks run out. The transportation and the purchase from countries that pay in euro cause an increase in prices.
The purchase price of pigs for slaughter has fallen steadily over the past year. However, the low purchase price has been accompanied by higher production costs. This was mainly due to significant increases in feed and energy prices, wrote Napi.hu. The number of slaughter pigs bought in exceeded 3.9 million, up 3.5 percent compared to 2020.
The way pigs are slaughtered has changed due to various regulations. The animal must be killed painlessly after it has been stunned. Otherwise it would be considered as animal torture. There is also a law that such meat products are only for home consumption. Trade is only allowed with specific permits. Today, compliance with food safety regulations is also extremely important. One of these is slicing meat products with a clean knife, which may previously have been dipped in hot water.
The interest in home-made products is growing despite the fact that the prices of chops, sausages and salami are 10 percent higher than in a shopping centre. Despite this, local products are getting more sought-after than processed or import products. The majority of customers aim to buy quality products, even at a higher price. Also, the process of slaughtering is an old Hungarian tradition. Friends and family gather together to help each other, providing meat products for the winter period.
New regulation for shops in Hungary will have a negative impact on consumers
The new government regulation will put shops in an impossible situation: they would have to stock as many price cap products as there are currently not enough in Hungary. Cheap imports could flood the country, but shops cannot obtain them overnight – which the regulation would require. The industry could be under pressure, with a further drastic price increase for non-price-capped products.
A market-destroying regulation?
According to one of the sources of portfolio.hu, the new “market-destroying” regulation is impossible to enforce with the double stock level, meaning that the government’s aim could easily be to punish and close down some (foreign) stores.
The Hungarian industry will not be able to meet the double order of price capped products. This is simply impossible, said a source to Portfolio in connection with the new government regulation. The rule, which will come into operation from mid-January, will require companies to stock price capped products on the shelves always, with a strict interpretation that they must provide twice the average daily stock previously required.
“In many cases, they could not even provide the single amount,”
said one of their sources, who said that there had been a continuous shortage of the price capped products in recent months and that there were still problems with the delivery of UHT milk and sugar. According to him, the Hungarian industry is not at all prepared to supply twice the volume, which the food industry will not be able to do later.
“It’s hell in the shops because people are already hoarding. But the cow won’t give any more milk than it has been. The chicken won’t have four breasts.”
Retail chains will now have to order double the quantity, regardless of demand, if they want to avoid a fine, said one of our sources on the fresh regulation. Therefore, many may open up to imports, but to prepare and double the quantity in 15 days seems impossible.
The purpose of the regulation and its effects
The regulation’s unhidden purpose is to end the shortage of groceries. However, by stimulating the market, all the cabinet is achieving is:
- either bring the moment closer when the government has to remove the price cap overnight, because the regulation is impossible to apply
- or the price of other non-price-capped products will continue to rise dramatically in order to cover the deficit.
One source said customers will face a huge problem. Companies have so far been covering the deficits on price capped products using other non-price-capped products. If they now have to stock twice as much as before, and therefore the deficit doubles, they will have to increase the price of non-price-capped products even more. This could happen in a few weeks, as companies will calculate within days how much their losses will increase as a result of the new regulation.
All deficits will be devolved, one of their sources pointed out. Of course, this is only true for the big chains, with more and more of the smaller ones closing down temporarily or permanently.
Highlighted by a source with insight into the retail sector:
“After the goverment publishes the regulation, the sector has once again raised the issue of attacking it in all possible areas.”
The removal of price cap
It could easily be that, due to market distortions, the food price cap will not allow soft lending, i.e. a slow removal of price cap. Therefore, the government has to bring back the market price overnight. In this case, the price of products now subject to a price cap would rise dramatically. The harsh business environment would ensure that the non-price-capped products, to which the deficits from the price cap have now been transferred, would not be cut back once the price cap is removed.
So, consumers will face a higher price level for groceries after the price cap than they would have if there had been no price cap.
The later the price cap is planned to be removed, the bigger the price growth will be. This is due to the continuous rise in purchase prices, unless the price cap market collapses before the removal, concluded one of their sources.
Hungarian potato will be out of the shops after January
National Potato Association: Hungarian potato will be out of the shops after January. Skyrocketing energy prices and the plummeting exchange rate of the forint have pushed up the costs significantly.
“Hungarian potato will be hard to find in the shops after January.”
Éva Kulich, the press officer of the National Potato Association, told 444.hu in a survey on the potato market published on Friday. Kulich pointed out that already in August, after the harvesting season, the shortage was evident, mainly due to the drought. In fact, this year has been very bad for potato in several European regions, wrote Telex.hu.
The price cap was not a solution for potato
The spokesman estimates that we eat an average of 26 kilos of potato a year. The 144,000 tonnes of potato produced in Hungary this year, or 8 million people, can cover only two-thirds of consumption, even without public catering and restaurant needs.
Hungary has not been self-sufficient when it comes to potato for years; and the area of potato sown and the number of producers have been declining for years. The price cap on it made more difficult the situation for producers. The government imposed it at the beginning of November, and unlike other products, it applies not only to a specific variety but to all types and presentations of table potato, from baking to salad ones, from two-kilo bags to 10-kilo sacks.
Read alsoFood shortage in Hungarian stores before Christmas: these products are missing
According to Éva Kulich, the price cap does not help the situation; shops cannot raise their prices but growers understandably want to recover at least the rising cost of production for their product, and they also need to prepare for the next sowing season.
Moreover, fixing the price of the product at the 30 September level was not a real solution because of the inflation, as the official price only reduced the price by 8-10 percent. This may vary from store to store, as the price frozen on 9 November was different.
Skyrocketing energy prices
As is generally the case for food products, potato production is very energy consuming and uses up a lot of pesticides and fertilisers. Hungary imports the seeds from abroad, at a price of euros, of course. Then there is watering, harvesting, sorting and cleaning. 90 percent of Hungarian potato are delivered to the shops washed –Â done by machines, if we are talking about industrial quantities. In addition, the products have to be packed, transported and stored in special conditions.
Skyrocketing energy prices and the plummeting exchange rate of the forint have pushed up these costs significantly.
Despite the fact that the weak forint and high fuel prices would make it logical to boost domestic production, supermarkets are trying to reduce the shortfall by importing as cheaply as possible. According to Kulich, the price cap leaves supermarkets with two options: either cut quality or cut profits. And since the second option rarely plays out, that leaves lower quality foreign imports, but there may end up being a shortage of potato.
20 percent increase may come, consumption will not decline
We have not yet reached the peak of food inflation. According to the deputy secretary general of the National Association of Agricultural Producers, prices for some products could rise by up to 20 percent a month. Despite the increasing prices, there is no reduction in consumption. Market experts believe that there will be another Christmas rush this year, with no drop in food consumption.
Although people have to pay less for a small purchase in the shop than a month ago, this was due to the capped prices of eggs, milk and the low price of bread, according to a report by ATV News. Apples now cost 100 HUF (0.25 EUR) more than two months ago, when they were 299 HUF (0.74 EUR) per kilo. The price of tomatoes rose by 200 HUF (0.50 EUR) per kilo, index.hu says.
Read alsoPost offices to reopen in Hungary in January
The cheapest eggs cost 799 and 699 HUF (1.99 and 1.74 EUR), but were almost twice as expensive in November. A litre of milk was almost 600 forints in shops a month earlier, but now it was only about half of that. Brown bread has also become cheaper, by 200 HUF. The price of 8-egg pasta has risen by 60 HUF (0.15 EUR), margarine by 50 HUF (0.12 EUR) and sour cream by 40 HUF (0.10 EUR).
According to the deputy secretary general of the National Association of Agricultural Producers, we have not yet reached the peak of food inflation. András Máhr, the deputy secretary general of the National Association of Agricultural Producers, pointed out that prices for certain products may rise by an average of 8-10 or even 20 percent per month.
“Further increases should be expected mainly in meat products. The purchase price of Hungarian pork is linked to the German price, where prices have risen by 20 percent in the last period”
– the deputy secretary-general said in an interview with HÃradó. He added that if the forint was stronger, this would be felt in shops.
The government has made a decision
According to Index, the government has extended the price cap to new categories of food. Eggs and table potatoes, to reduce the impact of inflation and food price rises. The range of goods covered by the price cap has been extended to include:
- eggs,
- table potatoes,
- flour,
- sunflower oil,
- pork,
- chicken meat,
- 2.8 percent milk and
- granulated sugar.
According to the latest announcement by the Ministry of Agriculture, the government has extended the price caps until 30 April 2023. According to Ministry Chief István Nagy, the need to maintain the price caps is due to the protracted war in Ukraine and the “misguided Brussels measures” that have led to sanction inflation.
István Nagy explained that in addition to the price cap, it is necessary to ensure the availability of fixed-price products. To reach this, it has been determined that traders are obliged to sell the average daily quantity of the products concerned in 2021. The obligations will be monitored by the general consumer protection authority, i.e. the county and metropolitan government offices, with the involvement of the National Food Chain Safety Office.
No drop in food consumption
Market experts believe that there would be another Christmas rush this year, with no drop in food consumption. According to napi.hu, more and more customers pick local products off the shelves.
In November 2022, consumer prices were on average 22.5 percent higher than a year earlier. Food prices have risen by 43.8 percent, with meat products showing an even higher increase of over 50 percent. The preparations for Christmas and New Year’s Eve mean that we consume more food than at other times of the year.
- Read also: FAQ – Christmas in Hungary
Short supply chains are increasingly popular
One way to prevent the further rise in food prices would be the practice of putting high-quality, locally sourced food items in our baskets, napi.hu suggests. The end of the year is one of the busiest times of the year for trade, when shoppers are especially on the lookout for domestic food products in local markets as well as in grocery stores. The holiday is an opportunity for consumers to choose quality ingredients for their Christmas menus, most of which can be sourced from local producers.
According to a 2020 survey by the Institute of Agricultural Economics, more than 70 percent of consumers buy local, artisanal products on a regular basis. The experience shows that local products are also in demand in online shops during the festive season, whether it is cheese, jam, beigli or even gingerbread cookies.
Seeking quality products at the local markets
“There are more and more conscious customers on farmers’ markets and the demand for home-made meat products is constantly growing” – said Balázs Sövényházi, a smallholder producer, to napi.hu. He runs a pig farm and sells processed products in his own shop. The interest is growing despite the fact that the prices of chops, sausages and salami are 10 percent higher than in a shopping centre. Despite this, he reckons that local products are getting more sought-after as the majority of customers aim to buy quality products, even at a higher price.
The concept of value for money has become more important because consumers now know that a sausage bought from a local producer’s shop contains way more meat than a pre-packaged product on the shelf of a supermarket chain. In recent years, a number of government policies have helped local producers to enter the market. Sövényházi believes it would be a great help to meat producers if the government would improve the conditions for running small butcher’s shops.
Hungarian Christmas dinner: How much will it cost this year?
Hearty, meaty and absolutely delicious – Hungarian cuisine has captured the hearts of many. Our traditional Christmas dishes are also widely consumed all over the world. However, the price of festive staples such as fish soup, stuffed cabbage and beigli has risen significantly due to inflation.
Hungarian Christmas is getting more pricey
Everyone is aware of the current skyrocketing prices, but we may not remember how much we paid for certain products last year. Telex.hu has looked at the figures of how much we paid for the most popular Hungarian Christmas foods in 2021 and how deep we have to dig in our pockets this year.
Stuffed cabbage, cabbage, rice and salt have become considerably more expensive. However, you can save a lot, if you choose to mince the meat and pickle the cabbage in your own kitchen. One beloved ingredient, sour cream, will be likely missed from many Christmas tables this year as its price has risen by 30 percent compared to last year.
Traditional Hungarian fish soup requires few ingredients, but all of these ingredients became more expensive. Onions are 162 percent more expensive, while the price of carp has risen by HUF 1,200 (EUR 2.99) per kilo. Unprocessed whole fish is much cheaper, so those who can be bothered can save money. In 2021, a four-quart fish soup cost HUF 3,262 (EUR 8,13), but this year we have to pay HUF 4,743 (EUR 11,82) for the same thing, which means a 45 percent increase.
Fried meat and mashed potatoes are also must-have dishes in the festive season. The prices of these items stayed more or less the same thanks to the price freeze on cooking oil and chicken breast. In the case of mashed potatoes, potatoes and milk are also price-sensitive products.
However, if we look at beigli, the price of butter has increased dramatically, from HUF 4,000 (EUR 9,97) last year to HUF 10,000 (EUR 24,92) this year. Opting for whole poppy seeds and grinding them at home, as well as using a fat and butter mixture, can help to cut costs.
Words of wisdom
In 2021, the price of a classic Hungarian four-course Christmas meal amounted to HUF 11,122 (EUR 27,71), while in 2022 it will cost us HUF 15,668 (EUR 39,04). This means that the entire Christmas menu costs almost 41 percent more than last year.
It is worth comparing prices in different supermarkets and keeping an eye on special offers. Besides, you can also do some preparation at home to save a couple of forints.
Read alsoHungary could have the most beautiful Advent tram in Europe
Here are the causes of the Hungarian fuel crisis
In Hungary, the media has been loud about the petrol price freeze and the petrol shortage. Refuelling is already a serious challenge in Hungary, even though petrol stations are introducing quantitative restrictions. The reasons and possible outcomes are explained in our article below.
Nationwide fuel shortages
The Hungarian government capped the price of fuel at HUF 480 (EUR 1.16) on 15 November 2021. The aim of this decision was to avoid the price of petrol reaching the psychological limit of HUF 500 (EUR 1.21) per litre.
The official price took a huge burden off the shoulders of many citizens who already have difficulties making ends meet due to the ever-rising living costs. However, major fuel importers have pulled out of Hungary as a consequence. This left Mol as a single supplier in entire the domestic market.
Mol bought 85 percent of the Hungarian oil wholesale market in November, index.hu reports. Hungary is providing fuel for the whole country by utilising its own resources, but this can be only maintained if the Friendship pipeline works without problems. In addition, it is important that domestic oil refineries can process the incoming oil.
The Százhalombatta refinery, which is currently operating at 55 percent, is a key part of this process. Furthermore, the Friendship pipeline is not a reliable source, as it has been damaged more than once since the war broke out.
Is the population to blame?
Fuel is cheaper than its market price. Many people profit from this by filling up and storing or reselling. This creates supply problems that put even the largest market player in a difficult situation. There were days when MOL’s wells ran out of fuel 70-100 times.
It is also noticeable that because of cheap prices, Hungarians use their cars more often than before. Customers bought 20-30 percent more petrol and diesel than in the previous year.
Petrol stations are also protesting against the price cap. They are losing money on every litre of oil, and as a result, many of them has been forced to close down, writes hvg.hu.
Read alsoFuel will become 25-30 percent more expensive for a lot of people in Hungary from January 2023
What can we expect?
More and more petrol stations have introduced quantitative restrictions on refuelling. These are not worth it and cannot be circumvented. Without the price cap, the price of 95-litre petrol would currently be HUF 617 (EUR 1.45) and HUF 681 (EUR 1.65) in the case of diesel.
The price cap also jeopardise the security of supply. The fuel price freeze is currently in force until 31 December. Experts say the government would not extend it until 2023.
However, it is not just the affordability but also the supply that pose questions. From 5 February, it will no longer be possible to import products made from Russian oil into the EU. Péter Szijjártó, Minister for Foreign Affairs and Trade, has previously said that “Hungary’s purchase of Russian oil and gas is not a political statement, but a physical reality, as it is the only way to guarantee our country’s supplies at the moment”.
Read alsoPanic at Hungarian gas stations due to fuel supply hoax
Panic at Hungarian gas stations due to fuel supply hoax
The last couple of days saw mass hysteria and ramping panic buying at Hungarian petrol stations, which were triggered by the fake news that the price cap would end at midnight on 2 December. Huge crowds of people flooded the gas stations on Friday afternoon in hopes of getting fuel for a price of HUF 480 (EUR 1.16).
According to RTL.hu, long queues formed at gas stations on Friday afternoon, when the news broke out about the end of the price cap. However, it all turned out to be false. According to recent reports, the government extended the fuel price cap until 31 December. The hoax rapidly caused nationwide fuel shortages so many people were left with empty tanks for the weekend. The distressed customers would drive from station to station in the bid to find a few drops of petrol but their efforts were mostly in vain.
Hungarian refinery in trouble
Gergely Gulyás, the current Minister of the Prime Minister’s Office, stated that if the Hungarian refinery, MOL, was unable to provide a sufficient amount of fuel supply then the government would have to take further action. He said that
the situation was rather worrisome as the country was about to face a serious fuel crisisÂ
unless immediate changes were made. There was no clear answer from MOL as to whether they could ensure a sufficient fuel supply. They replied though that all of their employees were working on the issue in full swing.Â
- Read also: Severe oil shortage hitting Hungary soon?
Further Complications
Although Hungary was exempted from the Brussels oil sanctions, certain factors further complicate the situation. The above-mentioned sanctions will enter into force at the beginning of December and will prevent countries from trading Russian oil among themselves. This means that not even MOL’s refineries in Százhalombatta and plants in Bratislava are allowed to do business. Russian threats to stop fuel deliveries, which would force Hungary to switch to sea transportation, are posing an additional hazard.
Ending the price cap
The problem with the fuel price cap is that it creates supply chain issues because no one is selling fuel as cheaply as MOL does, so the whole process becomes unsustainable. According to energy experts, the price cap should have been abolished a long time ago to maintain the stability of the country’s supply.
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