Supermarket chain Edeka expects stable food prices this year

According to the supermarket chain Edeka, food prices are likely to remain largely stable this year. "We're currently experiencing a moderate price increase in the food sector, around 2 percent," said Mark Rosenkranz, head of the largest regional company, Minden-Hanover, at the annual press conference in Minden. He expects this to continue for the rest of the year.

After the massive price jumps in 2022 and 2023, inflation is now returning "to normal levels." However, Rosenkranz admitted that there are isolated spikes: For example, the price of coffee is currently "historically" high. "On the other hand, there are also products that have become cheap again." Cooking oil, for example, "was extremely expensive for years. Now it's extremely cheap." And prices for cocoa and butter have also fallen again.

Last year, despite the weak economy, Edeka Minden-Hannover increased sales by 2 percent to €12.24 billion, partly due to higher prices. However, there was also a slight increase in volume, Rosenkranz added. Profit after taxes, however, fell from just under €179 million to €146 million.

Unlike other products, there is no customer hesitancy when it comes to food, which is Edeka's core business. "The food retail industry is fundamentally resilient to crises and economic downturns because people always have to eat," Rosenkranz said. "It's a relatively quiet business."

However, customers are also paying significantly more attention to price when it comes to groceries. The supermarket chain has recorded above-average growth in its own brand "gut und günstige" (good and affordable). Beyond groceries, however, Edeka is also experiencing a purchasing reluctance. Due to the uncertain economic situation, many consumers are foregoing major new purchases. "We can't avoid this weak consumption at the moment."

This is particularly noticeable at the hypermarket subsidiary Marktkauf, which generates 20 percent of its sales from non-food products. While food sales there also increased by more than 2 percent, there was even a slight decline for other products, the entrepreneur said. At Edeka itself, in contrast, the non-food share is only 3 percent. This is therefore "not so significant" here.

After three years of spending restraint, he expects "consumer sentiment to turn around by summer at the latest," Rosenkranz said. "That also depends to some extent on what happens with possible trade restrictions?" That's difficult to predict at the moment.

Edeka Minden-Hannover claims to be the largest of the seven Edeka regional companies in Germany. Its territory stretches from the Dutch border to the Polish border and includes East Westphalia, Lower Saxony, Bremen, Saxony-Anhalt, Berlin, and Brandenburg. The cooperative network includes more than 600 independent retailers with nearly 1,500 stores and nearly 76,000 employees. Almost half of these are located in Lower Saxony.

RND/dpa