Grocery Prices Remain Elevated Even as Eurozone Inflation Eases

Eurozone consumer price inflation has fallen to near-target levels and the European Central Bank (ECB) says monetary policy is on track. Yet grocery receipts keep rising. Inflation rates only show price-change speed, not absolute levels. Eurostat reports food and non-alcoholic beverages rose 33.2 % from 2016 to 2025, the largest cumulative gain among consumer categories.

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Two forces sustain high food costs. Wages across the supply chain have risen sharply: agricultural pay rose 6 % in 2022 and above 5 % in 2023; transport and storage wages rose 4.3 % in 2022 and 6.3 % in early 2023. EU labour costs rose 5.1 % in 2025, outpacing food-price inflation. Meanwhile, key inputs surged—milk +12.6 %, eggs +10.7 %, cereals +9.6 % in Q1 2025, and urea prices jumped 46 % month-on-month amid Middle-East energy shocks.

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Price levels differ sharply east-west. Eurostat’s HICP food index puts Hungary at 204.56 (prices more than double since 2015), Estonia 180, Lithuania 177, Poland 174, versus France 135. 2025 food-price inflation ranges from 0.7 % in France to 6.7 % in Romania. Household food spending also varies: Romania spends about 25 % of income on food, Bulgaria 21 %, Latvia 20 %, compared with Germany 11.5 % and Luxembourg 9.3 %.

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The ECB’s Consumer Expectations Survey reports that one-third of eurozone consumers now worry about affording the food they want. Higher absolute prices, combined with limited substitution options, squeeze budgets, especially in Eastern Europe where food consumes a larger share of disposable income.

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The ECB warned that “lagged effects from past price increases in international food commodities” will keep food inflation “somewhat above 2 %” through 2027. The World Bank’s April 2026 Food Security Update flagged fertiliser price spikes as a fresh shock to agricultural costs. ECB wage forecasts project negotiated growth stabilising near 2.6 % in 2026, signalling ongoing pressure.

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Consumer anger often targets supermarkets for alleged profiteering. Yet a peer-reviewed 2025 study of 89,000 European food and beverage producers found price markups fell over 2013-2022. McKinsey’s 2026 grocery report notes sector EBIT margins at just 2.8 %, calling the situation “a pause rather than a recovery,” leaving little scope for retailers to absorb cost shocks.

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• “lagged effects from past price increases in international food commodities” — European Central Bank (ECB)

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• “A peer-reviewed study published in January 2025 analysed nearly 89,000 European food and beverage manufacturers across 2013–2022 and found that price markups — the margin above marginal cost — actually decreased over the period.” — peer-reviewed study (2025)

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• “a pause rather than a recovery” — McKinsey, 2026 European grocery report

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• “One in three eurozone consumers, the ECB reported, now worries about being able to afford the food they want.” — ECB Consumer Expectations Survey

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ECB projections keep food inflation above the 2 % target into 2027, while wage growth is expected to ease to around 2.6 %. Future fertiliser price trends and commodity volatility will shape grocery price trajectories.

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