Food shortage crisis in Germany

Based on a survey, the German Ifo Institute announced the continuation of delivery bottlenecks and high shortages in the country’s food supply, and further announced that food has now replaced energy as the number one driver of price increases in Germany and some other countries.

The German newspaper “Hamburger Abendblatt” wrote in an official report: Delivery bottlenecks in the food retail sector were unusually severe in Germany even at the beginning of spring.

In March, 77.7 percent of surveyed companies reported relevant shortages, after 85.7 percent in February, the Ifo economic institute said in its survey on Monday. Those reporting delivery problems are still high. However, he expects a gradual easing in the coming months. According to him, the reduction of supply problems should help slow the increase in food prices at the end of the year.

The German Retail Association (HDE) expects conditions to improve slightly in the coming months. HDE expert Michael Rink said about this: Global supply chains have resumed their usual cycle in many areas. According to him, the supply chain to and from Russia and Ukraine is currently disrupted due to the war. Rink said: Due to the change of the Corona policy in the Chinese government, the supply chains to and from China are decreasing again.

At the same time, more food retailers in Germany are reporting weak demand. In the first quarter of last year, 28.4 percent of retailers surveyed complained about the issue, up from 27.8 percent in the fourth quarter of 2022. Taking a fresh look at these inflations, Hoeppner said, customers tend to buy less food and consciously Choose their price.

Food has now replaced energy as the number one driver of price increases: according to the Ifo Institute, food increased by an average of 22.3% in March compared to the same month last year, while energy only increased by 3.5%. The percentage went up. For the third year in a row, workers face falling real wages due to persistently high inflation.

Delivery problems at car dealerships have recently worsened. 77.9% of the surveyed companies reported bottlenecks last month. In February, 69.9% still complained about this issue. According to the Ifo Institute for comparison: In the retail trade as a whole, 49% of companies surveyed are affected by bottlenecks and shortages, after 53.5% in February.





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