Prices of staple foods to drop by 15% in February, remain stable for nine months

The price of around 400 food products will drop from 1 February following a price stability agreement between the government and major food importers and retailers.

The products from 15 food categories, include spaghetti, corned beef, tuna in vegetable oil, fresh and frozen pork chops and chicken legs, tea and instant coffee. All brands in the selected categories are subject to the price stability agreement.

The reduction will be a minimum of 15% on the recommended retail price (RRP) set by importers and producers on 31 October 2023. The cut off date marks the period when the Economy Ministry took a snapshot of the market.

The reduction in profits on the selected items will be shared between the importers and sellers.

Minister insists this is not price-fixing

Economy Minister Silvio Schembri, who spearheaded the initiative said the agreement was for nine months until the budget in October.

Prime Minister Robert Abela and Economy Minister Silvio Schembri (Photo: DOI)

“This is not a price-fixing exercise but an exercise in creating price stability on a range of basic foodstuffs to mitigate against the impact of inflation on families,” Schembri said.

He said the nine-month timeframe was set in view of Eurostat forecasts that indicate food inflation is expected to drop later on this year.

200 outlets in scheme

Around 200 outlets, including all major supermarkets, and almost all major importers have signed up to the agreement.

A list of products with the RRP price as of October 2023 and the stable price as determined by the agreement will be available online from 1 February.

Participating outlets and products will be clearly marked in shops with the logo Stabbilta.

Major importers and supermarket owners present at the announcement (Photo: DOI)

Schembri said government will be rolling out a support scheme for small family-run retail outlets that want to participate in the agreement. These outlets will receive a grant of €125 per month to make up for the reduction in profits they will sustain if they join the price stability agreement.

Unlikely COLA impact

Schembri insisted the main driver behind the agreement was price stability. He said the agreement was not intended to impact the cost of living adjustment (COLA) mechanism.

“The categories were not chosen because they will impact COLA, which is based on around 150 categories. They were chosen because they are staple food categories that experienced price increases as a result of international instability,” Schembri said.

When asked why baby formula milk was excluded from the agreement, Schembri said families with children were helped in the budget with more generous payments in Children’s Allowance and newborn grants.

Schembri described the agreement as “historic” and insisted the government was not addressing a situation of profiteering by importers.

PM calls importers, supermarkets ‘genuine interlocutors’

Prime Minister Robert Abela said his government wanted to give people and businesses stability and peace of mind at a time of global uncertainty.

“The government does not believe in the politics of austerity because it creates further uncertainty and instability, which is why we supported families and businesses during the pandemic and later on when the war in Ukraine erupted,” Abela said ahead of the signing of the agreement with importers and supermarkets on Thursday.

He said the price stability agreement was intended to address rising prices for essential food items that continued hound families.

Abela said the agreement would improve the purchasing power of families.

He thanked importers and supermarket owners for being “genuine interlocutors” in what he described as a “difficult” journey to reach this agreement.

Abela singled out minister Silvio Schembri for believing in the initiative and bringing it to fruition.

“Stability will give consumers peace of mind,” the Prime Minister said.

He took a dig at the Chamber of Commerce without mentioning them by name for coming out against the agreement in a statement on Sunday.

The agreement was signed between the government and 28 major importers and big retailers.

Food categories subject to price stability agreement

The following food items will see a reduction of 15% on the recommended retail price, leading to lower prices for consumers from 1 February:

1.Corned beef, full fat, light and reduced salt, in all sizes.

2.Cornflakes in packets or bags.

3.Cream crackers in all sizes.

4.Fresh and frozen minced/ground beef and/or minced/ground pork and/or a combination of both, in packets.

5.Packed fresh and frozen pork chops.

6.Frozen raw chicken legs, both packed and loose form/by weight, and fresh packed.

7.Frozen raw whole chicken, both packed and loose form/by weight, and fresh packed.

8.Frozen peas, broccoli and spinach in bags of all sizes (excluding organic).

9.Imported black tea bags of all sizes.

10.Instant coffee including decaf in all sizes.

11.Skipjack tuna in vegetable, soya or sunflower oil in tins of 70g to 200g (excluding skipjack and yellowfin tuna in brine and in olive oil).

12.Standard, low fat and reduced salt vegetable spreads in tubs or foil.

13.Straight cut frozen friable french fries in bags of all sizes.

14.UHT milk; Skimmed, semi-skimmed and whole in cartons or bottles of all sizes.

15.Wheat spaghetti and penne in packets of all sizes.

Check out which outlets and importers are part of the agreement on the Stabbiltà website.