Agricultural producer prices increased by 49% in quarters 1–3 of 2022, within which the price rise for crop products (54%) was higher than that for animals and animal products (39%). The similarly substantial, 46% increase in input prices was primarily owing to a 51% price rise for the components of intermediate consumption, while investment prices were up by 15%. The price increase was connected with disturbance in supplies, a rise in energy prices and the unfavourable weather. The value of the agricultural terms of trade was 102.4%.
Almost all factors result in price increase
The significant price rise was caused by several factors together in the past period. Disturbance in supplies and in demand and supply, which evolved because of the Covid-19 pandemic, is not completely over, besides, energy prices rose as well in parallel with the restart of the economy. According to calculationsSource – The price change published in the report is an average price change calculated from world market prices for different kinds of crude oil and natural gas.[1] by the World Bank, energy carriers, used as an input, became 47% more expensive on average, globally, over a year. The most substantial price increase within this was the natural gas price rise in Europe. The Russo-Ukrainian war brought about uncertainties in food and energy supplies, as well as in general, in the world market. The weather was unfavourable, too, in Hungary in the first nine months. The spring frost and then the drought made the conditions of production worse, the latter affecting other European countries, too.
Wheat and maize prices still rise
Cereal and oil crop prices grew dynamically, by 74% and 62%, respectively, in total. The price rises were due to a keen international demand for forage plants and to transport problems because of the war. The prices are increased by the drought, covering all of Europe, which hindered harvest results and unfavourably influenced market prospects, too.
Fruit prices went down as a whole. Fruit prices, as opposed to prices of the remaining product groups, were cut by 3.2% on average. The price of apple lessened by 3.9% in the first nine months of the year.
Potato and vegetable prices were 44% and 40% higher, respectively, in the first 9 months compared to the same period of the previous year.
Prices of chickens for slaughter and pigs for slaughter significantly up
Live animal prices were up by 42% in the first 9 months of 2022. The procurement price of chickens for slaughter has continuously grown for two years, it was 45% higher in quarters 1–3 of 2022 than in the corresponding period of the previous year. As a consequence of avian influenza, the quantity of chickens for slaughter was reduced in Europe, and the production costs drastically rose.
The price of pigs for slaughter went up by 42% in quarters 1–3 of 2022 compared to the same period of the previous year, by more than a quarter in the last three months, so it reached 733 forints per kilogram in September 2022. The procurement price of pigs was at a low in February 2021 (HUF 344/kg), that is why fewer fattening pigs were put into production, later the volume of slaughtering also decreased. Owing to a recovery in the demand and a drastic increase in the production costs, however, the producer prices were up considerably as well.
Fertiliser prices go on rising
The 46% increase in agricultural input prices in quarters 1–3 of 2022 was due to a 51% growth in the prices of intermediate consumption and a 15% increase in the price level of agricultural investments.
All components of intermediate consumption became substantially more expensive. The highest increase of 205% was measured in the price of fertilisers, as an impact of a drastic growth in the price of natural gas, necessary for the process of production. Within fertilisers, mostly nitrogenous fertilisers became more expensive, by 246%.
Animal feeding stuff prices were up significantly, by nearly 45% compared to the corresponding period of the previous year, within which straight feeding stuff prices by 58% and blended feeding stuff prices by 34%. Because of an increase in base material prices, the rise in the prices, which started in the 4th quarter of 2020, continued, and animal feeding stuffs cost 12% more in the 3rd quarter of 2022 compared to the previous quarter.
Plant protection products became 19% and veterinary medicinal products 11% more expensive compared to the same period of the previous year. Energy and lubricant prices rose by 47%, within which the price of electricity increased by 94%, that of fuels by 89% and motor fuel prices by 27%.
Within agricultural investments, the price level of investments in buildings was up by 21% and that of investments in machinery and equipment by 10%.
As producer prices rose more than input prices, the value of the agricultural terms of trade was 102.4% in the first nine months of 2022.
[1]:↑ Source – The price change published in the report is an average price change calculated from world market prices for different kinds of crude oil and natural gas.
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