A discussion paper published today by the Competition Authority states that the price of food in Iceland is among the highest in Europe. Thus, Icelanders pay on average fifty-five per cent more for food than residents of the European Union. Only in Switzerland is food more expensive, at 58 per cent above the EU average. In Norway, prices are 32 per cent above the average, while prices in Sweden and Finland are only 6 per cent above the average.
The analysis shows that since 2020, the largest increases in the grocery market have occurred in Iceland, compared to neighbouring countries. Food prices in Iceland have risen by 46 per cent, compared to a 37 per cent increase in EU countries. Switzerland is something of an exception in the comparison, where food prices have only risen by 3 per cent over the same period, while in Norway they have risen by 32 per cent, in Finland by 22 per cent and in Ireland by 25 per cent.
Of individual food categories, domestic dairy products are the most expensive in Europe, at just over 90 per cent above the EU average. Meat products are next, at around 75 per cent above the average. The price of meat in Norway has risen the most of all product categories since 2020, by 67 per cent. In the same period, the price of dairy products has risen by almost half as much, and the price of meat by a third less.
High prices and significant increases for meat and milk compared to neighbouring countries are partly explained by the fact that in this country, processing plants are permitted to merge without competition authorities being able to block anti-competitive mergers. Furthermore, processing plants are permitted to consult with one another, regardless of whether they are owned or controlled by farmers. Everywhere else in Europe, competition authorities are tasked with protecting the interests of consumers and farmers in this regard.
The Competition Authority's discussion paper provides a more detailed account of product prices in Iceland and a comparison with other European countries. The discussion paper is part of a wider investigation into the grocery market. Data collection is currently underway, which aims, among other things, to examine the mark-ups of grocery retailers and suppliers and to identify any barriers to competition that affect grocery prices in this country.
A large proportion of total household expenditure is spent on food, and the high price of food in this country is therefore a major concern. The Competition Authority is therefore calling for views on the contents of the discussion paper and for suggestions regarding barriers to competition. Such potential barriers to competition may, for example, concern any undue obstacles to the importation, production, wholesale and retail of foodstuffs.
Please note that the deadline for submitting views is 30 June.
Readable The discussion document is here..
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