Supermarket trips still feel like financial risks, even as inflation eases. Lower inflation doesn’t mean grocery prices are falling — they’re just rising more slowly. The damage from a generation’s worst food price surge remains baked in, and it’s not going away anytime soon.
Food inflation in the EU dropped to 2.8% in 2025, but that’s a rate of increase, not a drop in prices. Prices don’t reverse when inflation slows; they just stop climbing as fast. The mountain stays, even if the ascent eases.
Over the past decade, food and non-alcoholic beverages saw the biggest increase in the EU, rising 33.2% between 2016 and 2025. That’s more than energy, services, or any other category. Globally, food prices were 46% higher in mid-2025 than in 2015, according to OECD data.
Wages have climbed faster than food inflation in many regions. In Germany, wages rose 4.0% while food inflation hit 2.2%, causing retailers to take on some expenses. But even this buffer is shrinking. The ECB projects wage growth will stabilize at 2.6% through 2026.
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New shocks are pushing prices higher. Milk prices jumped 12.6%, eggs 10.7%, and cereals 9.6% year-on-year in Q1 2025. These upstream costs take months to reach shelves. Chocolate rose 17.8%, frozen fruit 13%, and beef 10% in 2025.
Fertiliser prices spiked 46% monthly in April 2026, driven by Middle East conflict. The ECB says lagged effects from past price increases will keep food inflation above 2% through 2027.
Blaming corporate greed is tempting, but data tells a different story. A 2025 study found price markups in European food firms dropped over a decade. McKinsey’s 2026 report puts average EBIT margins in the sector at 2.8%, a “pause rather than a recovery.”
Profit margins are thin, leaving little room to absorb rising costs. When wages, energy, or packaging regulations increase, prices rise. The question isn’t whether costs are passed on — it’s how quickly.
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Food inflation varies wildly across the eurozone. France saw 0.7% in 2025, but Romania hit 6.7%. The Eurostat HICP index shows cumulative price levels since 2015: Hungary’s food prices are up 102%, Estonia 80%, and Poland 74%.
In Eastern Europe, food spending eats up a larger share of income. Romania households spend 25% of income on groceries, Bulgaria 21%, and Latvia 20%. Compare that to Germany’s 11.5% and Luxembourg’s 9.3%.
A country where food costs 2.5 times 2015 levels, and groceries take a quarter of income, faces a reality far harsher than France’s, even though both are in the eurozone. The ECB’s 2% inflation target feels distant for many.