Published: December 07 2023
The Hungarian food industry is experiencing growth, driven by the improved situation of livestock farmers. This growth is expected to continue as demand for grocery products increases alongside a rebound in real wages. However, food retail sales are still below normal levels.
Impact on Crop Profitability
Due to the drought of 2022, the total crop harvest in Hungary has decreased to 5.6 million tons, below the historical average. However, the average yield per hectare has remained high at over eight tons. Maize is the only crop expected to be profitable this year.
Challenges in the Milling Industry
Only twenty percent of the wheat harvest met the milling quality standards, compared to the usual fifty to sixty percent. This has resulted in a lower quantity of wheat available for the milling and pasta industries.
The Resilience of Livestock Farmers
Livestock farmers and breeders have been able to operate efficiently in a challenging environment for the past 10-15 years. Their ability to produce efficiently has allowed them to generate higher profits under favorable conditions.
Forecast for Lower Heating Costs
The upcoming winter is expected to be mild due to El Nino, replacing La Nina. This is good news for consumers as it will result in more affordable heating costs due to lower energy prices compared to the previous year.
Questions & Answers
What has been the outlook for the Hungarian food industry in the third quarter? The Hungarian food industry has continued to improve in the third quarter, with the sector being pulled by the more favorable situation of livestock farmers.
How much has food inflation eased by autumn? Food inflation has eased to around 10 percent by autumn.
What are the hopes for grocery product demand in Hungary? The easing of food inflation raises hopes that demand for grocery products will improve alongside a rebound in real wages.
Are food retail sales in Hungary at normal levels? No, food retail sales in Hungary are still below normal levels.
What is the forecast for the recovery of supply chains damaged by the Russian-Ukrainian war? Supply chains damaged in part by the Russian-Ukrainian war could be restored by 2025.
What is the forecast for real wages and consumption in Hungary? By 2025, real wages could further strengthen and consumption could also grow substantially.
What crop is expected to be profitable in Hungary this year? Maize is expected to be the only profitable crop in Hungary this year.
How has the total harvest of crops in Hungary been affected? The total harvest of crops in Hungary has shrunk to 5.6 million tons, well below the historical average.
What is the average yield of crops in Hungary this year? The average yield of crops in Hungary has been above eight tons per hectare, a level last seen in 2019-2020.
What percentage of the wheat harvest was of milling quality this year in Hungary? Only twenty percent of the wheat harvest in Hungary was of milling quality, compared to the usual fifty to sixty percent.
How has this affected the milling and pasta industry in Hungary? The lower quantity of milling-quality wheat has resulted in a lower amount that can be used by the milling industry and the pasta industry.
What has been the situation of livestock farmers and breeders in Hungary? Livestock farmers and breeders have had to operate efficiently in a difficult environment over the past 10-15 years, and only a significant number of them have managed to do so. They have learned to produce efficiently, generating higher profits under favorable conditions.
What is the forecast for heating costs in Hungary this winter? This winter is forecast to be mild due to El Nino, which could result in more affordable heating costs at lower energy prices than last year.
