Romania: Food prices to increase 20% in H2 2009

Prices of basic foods will increase 15-20% in the second half of 2009, even as prices have increased around 18% compared to October, said Ştefan Niculae, chairman of the Agrostar Federation, according to Bursa.The price hikes expected to happen in June-July are caused by the elimination of state subsidies for producers, which are now forced to raise prices to cover their production costs, with another factor being the cartel policy of hypermarkets, which raised prices without a valid reason, "Agrostar" officials said.
As such, pig and poultry breeders, as well as milk and grain producers will no longer be allowed to receive government subsidies this year, which will make their products the first to see price hikes.