In Russia, the price of food products has exploded since the start of the year

According to the latest update of projections from the International Monetary Fund (IMF), the Russian economy is expected to grow by 3.6% this year — the same rate as in 2023. At the same time, the closure of a large number of countries to Russian tourists as well as bonuses distributed by the federal state and other administrative subdivisions for signing contracts with the army lead to a significant increase in expenses.

While inflation remains high, it is much lower compared to the peaks reached between March 2022 and February 2023. However, in Russian supermarkets, thefts of consumer products are increasing. At the end of October, two men were arrested with 25 packets of butter in their hands on the streets of Moscow .

This event is far from isolated.

• In some stores of the Kirovsky group (Кировский), the largest supermarket chain in Yekaterinburg, in the Sverdlovsk oblast, butter has been sold for more than a year in “protective cases” in order to deter thieves .
• For good reason: the price of butter has seen an average increase of more than 30% since the start of the year, according to official data published last week. .
• This is twice as much as other dairy products such as milk or crème fraîche, but much less than the nearly 73% increase in the price of potatoes.

Butter manufacturers attribute this increase to the increase in their production costs: from raw materials such as milk, to fuel for transport and up to bank loans and logistics costs. The butter crisis follows a similar trajectory to that which affected eggs in 2023. In December of last year, the price of the latter had increased by more than 40% over the year.

• The increase in prices of consumer products (especially food) is a direct consequence of the war waged by Russia against Ukraine and the transformation of the Russian economy, the main objective of which is now to produce weapons and ammunition for his army.
• By investing massively (and mainly) in the defense industry, Vladimir Putin forced other sectors to increase their salaries in order to face competition. Increases in production of goods and services are now accompanied by significant price increases — a sign of an “overheating” economy .

In order to contain inflation, the Russian Central Bank increased its key rate by a further 200 basis points at the end of October, bringing it to 21% – its highest level since 2003. . Many experts, however, consider that this will not be enough to stem inflationary pressure in Russia. .