Hungary: Government aims to curb inflation with the expansion of its price-tracking website

Ministry to expand price tracker system to combat inflation

The Ministry of National Economy announced plans to expand the range of products monitored by the online price tracker to 100 items. This initiative aims to curb rising food inflation.

The government launched its price tracking system in June, 2023. On this public website, the prices of products at various retailers can be compared. According to the ministry, in the first three months after the website's launch, average prices decreased by 6.7% across 56 of the initial 62 product categories.

The latest official data shows that food inflation is on the rise, currently exceeding 5%. According to the ministry, this increase is driven by international factors such as the rising prices of raw milk and grains. However, significant retail margin increases have also been observed for certain products.

The government is currently considering expanding the list of products on the price tracker website with fish, coffee, tea, rice, milk cream, beef, pork sausages, bread rolls, sweets, and cocoa.

Agriculture publicly minister opposes Ukraine’s EU accession

Minister of Agriculture István Nagy has posted a video on his Facebook page on Wednesday, in which he publicly opposes Ukraine’s EU accession. Minister Nagy states that “[Hungarians] can’t endanger [their] everyday bread and the livelihood of farmers.” Minister Nagy stated that Ukraine’s EU accession “poses significant danger,” with “unforeseen, drastic consequences, also reducing agriculture subsidies significantly, which would bankrupt Hungarian farmers.”

The minister also stated that in Ukraine, there are “large farms covering hundreds of thousands of hectares” which are owned by “Western capital,” and that these “do not have to comply with the strict production regulations of the EU.” He further added that the EU’s agriculture cannot compete with a regime that is “built on entirely different historical traditions, and operating within a completely different structure.” Minister Nagy added that Ukraine’s accession cannot be allowed to “destroy Hungary’s agriculture and render farmers’ livelihoods unviable.”

The pig sector’s situation improves

The Institute for Agriculture Economics reports, based on the latest data by the Central Statistical Office (KSH), that Hungary’s live pig sector export increased by 12%, to 30 thousand tons, y-o-y in November, 2024.

Imports still exceed exports, but the ratio has improved in favor of Hungary, as live pig imports decreased by 5% to 58.2 thousand tons. The quantity of Hungarian pork sold on the international market also increased by 14.4% to 140 thousand tons, and its value rose by over 11%. However, the volume of pork imports also grew by more than 7% to 126 thousand tons, and the average price of this product category increased by almost 8%.

Contaminated corn continues to cause problems

Agrárágazat.hu reports that due to the high level of aflatoxin contamination in the corn, market issues persist in Hungary as well as in neighboring countries, which means that corn can only be imported from farther away, at higher cost. The portal reported in the summer that as much as 40% of the harvest might be contaminated with aflatoxin due to the summer drought.

This issue poses a serious problem not only for farmers but also for the domestic feed and ethanol industries. Moreover, average aflatoxin levels in stored crops are always higher—sometimes even double—compared to rapid tests. As many are still waiting to sell their crops—and many buyers refuse to accept contaminated products—the contamination or its risk increases during storage, leading to higher costs for farms due to necessary treatments.

This has a strong impact on market conditions. The year 2022 already highlighted that corn cultivation will eventually decline, as it is becoming less and less profitable, the portal writes.

Companies rely more and more on immigrant labor

Agrárszektor.hu reports that domestic companies are more and more relying on immigrant labor in the face of a domestic supply shortage.

In the end of 2024, the Minister for National Economy Márton Nagy has declared that Hungary’s immigrant worker quota will be limited to 35 thousand in 2025 – This is less than half of the theoretical maximum, which is the mean of empty positions in the previous four quarters of any given year, which would make the theoretic legal maximum of immigrant worker licenses to be 71 thousand for 2025. The government also made the conditions stricter for immigrant workers. Under the decree, workers can only come from countries with which Hungary or the European Union has a readmission agreement, or from countries that have an organization recognized by Hungarian authorities. This reduced the number of countries from which immigrant laborers can arrive to work in Hungary.

Agrárszektor.hu reported this week that many countries contribute immigrant workers into Hungary’s agriculture industry, including the Philippines, which was recently included in the list of countries that meet the strict conditions of the governmental decree on immigrant labor. The portal added that the available workforce in Hungary for agriculture work is limited. While immigrant laborers are not cheaper than Hungarians, stakeholders in the agriculture industry are optimistic about employing Filipino employees.