Farm input prices, a key driver of food price inflation, are surging, according to the Central Statistics Office (CSO).
The agency’s latest agricultural input price index shows fertiliser prices rose by 149 per cent on an annual basis in March.
Significant increases were also seen in energy prices, which rose by 54.9 per cent and in feed prices, which are up by 22.6 per cent compared to March 2021.
Increases can also been seen in the output prices with the monthly price of milk up 6.1 per cent month on month and up more than 32 per cent on an annual basis. Cattle prices were up more than 22 per cent annually.
Food inflation is expected to intensify in the coming months as the second-round effects of higher energy costs push up prices in other sectors of the economy.
Rising prices have already seen the cost of an average weekly shop rise by approximately €15. On an annual basis that means groceries could cost €780 more, which is not dissimilar to the price hikes seen in the energy sector.
Upward pressure on food costs have also been compounded by Russia's invasion of Ukraine. The two countries together produce about 30 per cent of food commodities such as wheat and maize and a significant amount of farm inputs such as fertiliser.
The State’s cost-of-living squeeze intensified in March with inflation surging to a 22-year high of 6.7 per cent, up from 5.6 per cent the previous month. This was was sharpest rate of price growth recorded in the Irish economy since November 2000.
The latest figures for April will be released by the CSO on Thursday. The Central Bank suggests headline inflation could rise above 8 per cent in the coming months.
