Salon Express/Peak: Food Prices Reach 18-Month High

Foreks - The food sector is facing a challenging period in 2024 for both producers and consumers. Bora Yamaç, the Founder of Salon Express, emphasized the necessity of reducing input costs to counteract the rising food prices, stating, “While consumers battling inflation are suffering, producers with increasing input costs are also struggling to balance their pricing policies.”

Prices of food commodities have been steadily rising since the beginning of the year. The United Nations Food and Agriculture Organization's (FAO) food catalog index reached 127.4 in October, marking its highest peak since April 2023. Although food prices remain below the peak seen in March 2022, this increase is forcing higher expenditures in personal market shopping due to its effect on retail.

“THE FOOD SECTOR IS GOING THROUGH A DIFFICULT PERIOD” Bora Yamaç noted that the price increases in essential food items such as vegetable oils, wheat, cheese, and sugar have pushed food commodity costs to their highest levels in the past 18 months, saying, “Due to the increase in food prices, the food sector is enduring a tough time. While consumers are suffering from inflation, producers facing rising input costs are also having difficulty in balancing their pricing strategies.”

“INPUT COSTS MUST BE REDUCED” Emphasizing that food consumption is an essential need, Yamaç stated, “We have been operating in the food sector since 2005. For nearly six years, we have been providing packaged food production services to businesses offering take-out, cloud kitchens, and restaurants. We directly feel the struggles of our clients who reach consumers. The food sector needs to develop both short-term and long-term strategies to cope with the current inflationary situation. To create a sustainable food source, it is crucial to encourage farmers' production, as well as significantly strengthen the bond between producers and consumers. Establishing continuous collaboration to reduce input costs lies at the heart of solving this issue.”

EMPHASIS ON FIGHTING UNDER-THE-RADAR PRODUCTION Bora Yamaç pointed out that the increase in food prices is directing consumers towards more affordable products, stating, “We are experiencing a period where consumers are becoming more selective in their spending due to rising prices. While lower-priced options may always seem attractive, food health issues arise at this point. Particularly in essential food products, factors like supply chain disruptions and climate change may keep costs high. The minimum selling price of a product is determined through these factors as well. The fight against firms engaged in under-the-radar production is crucial for protecting consumer health and preventing unfair competition.”

“EMPLOYEE MEAL ALLOWANCES SHOULD BE EVALUATED IN LIGHT OF FOOD PRICE INCREASES” Regarding updates to employees' daily meal allowances, Bora Yamaç mentioned, “As you know, with the minimum wage increase in January, employees' daily meal allowances will also be determined. It is expected that the meal amount will rise by 44% to 240 TL in 2025, in line with inflation targets. To protect consumers, this figure should be evaluated in light of the increases seen in food prices.”