Hungary: Profit margin cap enters into force, outcomes vary

“Profit margin cap,” the second food price cap policy, entered into force

The new price cap regulation, dubbed the “profit margin cap,” has entered into force on Monday, March 17.

Telex.hu reported that, although the government mainly blames multinational grocery and large retail chains for high food inflation, many domestically owned stores have also been included in the regulation, and the restrictions may affect them the most. This is because the new regulation, which limits grocery stores’ markup at 10% for a select list of 30 products (full list and more details here) applies to companies with annual revenues above €2.6 million. Multiple Hungarian-owned companies have barely made it through the line, making their situation (which is already difficult due to high energy prices and other costs) even more complicated. To make matters worse for these domestically-owned companies, Telex writes, their offered range of products is more limited than that of large multinational chains, and a larger share of their income is dependent on the basic products listed in the new regulation.

While the prices of the products regulated by the new policy had decreased, some other products immediately became more expensive, HVG reported on Monday.

Portfolio.hu reported on an internal mail sent to Spar workers by CEO Gabriella Heiszler and general director Eduard Vonier.

“In recent years, this has been the latest in a series of measures that significantly hinder our operations, while 2024 was the third year in which Spar operated at a loss,” the letterstates. It adds that in the "communication noise," the fact that the margin is not equal to profit is often overlooked, the letter adds. After deducting the extra retail tax from the prescribed 10% margin, only 5% remains, from which wages, utilities, store rental fees, and all other costs are paid.

The company is facing a monthly loss of €3.9 million due to the profit margin cap, according to the internal mail. It adds that in the coming period, the company will institute “changes to its retail practicesif the current regulative environment does not improve, or worsens further, other, even harder measures will have to be taken,” .

Foot-and-mouth disease: Some restrictions lifted, disease appeared in Slovakia

The National Food Chain Safety Office (NÉBIH) has announced on Tuesday, March 18, that, together with county authorities, had completed the sampling of 45 contact farms affected by the outbreak, with all 4,973 tests returning negative results. In the preceding days, they had already begun lifting bans on transporting animals to slaughterhouses.

Given the good news on the epidemiological situation, Chief Veterinary Officer Dr. Szabolcs Pásztor decided to lift further restrictions as of March 18, 2025. Among other measures, the domestic movement and immediate slaughter transport of pigs, cattle, sheep, and goats have been reauthorized in Győr-Moson-Sopron County, except for the restricted area around the Kisbajcs outbreak.

Since Tuesday, animals destined for immediate slaughter may be transported outside Győr-Moson-Sopron County.

Domestic and European Union restrictions imposed in Baranya, Fejér, Komárom-Esztergom, Pest, Somogy, Tolna, Vas, Veszprém, and Zala counties have been lifted.

The transport of susceptible animal species to other EU member states is now permitted from all areas of Hungary, except Győr-Moson-Sopron County, also since March 18.

It is important to note, the authority writes, that the transport of susceptible animals from Győr-Moson-Sopron County to third countries or EU member states remains prohibited.

On Wednesday, March 19, Mr. Pásztor confirmed in a presentation that he held at the Portfólió Agriculture Conference that new outbreaks have not been identified, all tests are negative, and restrictions are gradually lifted, work is underway to regain the country’s freedom from the disease status.

On Friday, March 21, Slovakian Minister for Agriculture Richard Takáč announced that hoof-and-mouth disease appeared at three farms in Southern Slovakia, Bumm.sk reported. According to NÉBIH, Chief Veterinary Officer Dr.  Pásztor has immediately ordered the necessary official measures to be taken in the restricted zones that overlap into Hungary. To prevent the further spread of the disease, the existing domestic restrictions will remain in effect. (Note: Our reporting is based on the latest official information available at 2:01 PM, March 21, 2025.)

Parliament discusses proposed cultured meat ban act

The National Assembly discussed the proposed legislation on the complete ban on manufacturing and trade of cultured meat in Hungary on Wednesday, March 19.

The final discussion and voting on the legislation is scheduled for the first week of the April session of the National Assembly, sometime between April 7-10.

On March 19, Minister for Agriculture István Nagy argued in parliament in favor of the proposed ban, talking about dangers to human health, the sustainability of traditional food production, and the importance of food’s connection to the land. The minister also mentioned food safety, and the potential carbon footprint of cultured meat.

Fidesz MEP Sándor Farkas called cultured meat counterfeit food, expounding on the fact that if something is not original, it is counterfeit.

Christian Democrat (KDNP) MEP Lúrinc Nacsa said that Hungary is primarily an agricultural country, and that in parliament, priorities should be the interests of Hungarian farmers, producers and consumers.

Right wing party members of parliament chimed in at the discussion not only from the governing coalition but from the opposition too. Dániel Z. Kárpát, Jobbik MEP said that, in Hungary, cultured meat would likely only benefit multinational chains that spend far more on lobbying and marketing than on developing their product categories.

Mi Hazánk MEP went so far as saying that selling cultured meat and cultured meat-based product should be considered a crime. “Little by little, the people of the Global Maffia are trying to feed us so that they can give us cancer and other seriously ill diseases so that the same lobby can come in to cure us,” the politician theorized in his speech.