The Minister of Agriculture wants to cap the commercial surcharge for all Romanian agri-food products

Romanian agri-food products in stores will have a capped addition of a maximum of 20%, according to a bill initiated by Florin Barbu, the Minister of Agriculture and Rural Development.

On the occasion of the inauguration, last Friday, in the MADR yard of a fair to promote Romanian products, Minister Florin Barbu declared: "Until December 31, the emergency ordinance regarding the capping of the commercial addition to basic foods was transposed by the Parliament into law . There is currently a legislative project underway through which, together with my colleagues from the Ministry of Agriculture, we want all agri-food products that are processed in Romania to have a correct commercial value added. We no longer want the commercial markup on Romanian products to exceed 20% on the shelves of Romanian retailers. Thus, Romanian products should have a commercial surcharge limited to 20%, and for imported products, retailers should add whatever commercial surcharge they want. Because at the moment, if we do an analysis, and we did this analysis, the Romanian agri-food products have a higher commercial value than the imported products in retail stores".

The Minister of Agriculture specified that, since the capping of the commercial addition to basic foods took place (July 2023) and until now, products have become cheaper by percentages between 8% and over 28%.

"If we refer to the year 2022, the consumer price index from the INS shows the fact that the products were 30% more expensive compared to the year 2023, when we had ceilings on commercial additions", concluded Florin Barbu.

The statements of the Minister of Agriculture are in agreement with those of Prime Minister Marcel Ciolacu, who a week ago announced that the capping of the commercial addition to basic foods will continue at least until the spring of 2025.

Regarding this measure, Cristian Păun, university professor at the Bucharest Academy of Economic Studies, former president of FNGCIMM, notes on the official Facebook page:

"The ceiling on the commercial addition to food is in vain if you do not also cap the price of detergents or cosmetic products sold alongside food in supermarkets. Or if you don't also cap transport rates, storage rates, the price of raw materials, or the cost of wages. They should also be capped. Especially the taxes or the minimum wage. Because if they increase, with a fixed ceiling of commercial addition, prices will continue to increase fixed with the dynamics of production expenses".

Prior to this post, in mid-March, Mr. Cristian Păun also said that "the capping of the commercial addition to basic foods had zero effect on the prices of agri-food products, if not the opposite, especially in periods of poor supply such as from these winter-spring months superimposed on the Easter holidays". Your Lordship showed that in March we have higher prices by 0.81% compared to the previous month (on average), an increase that is added to those of the previous period.

Cristian Păun specified: "The government continues to follow this completely wrong path and contradicts the economics book and the principles of the market economy: it will extend the ceiling of the addition after 31.03.2024. 3 more months. What's more, a LAW on the "sovereignty" of Romanian agri-food products is being prepared, by which the commercial additions to all agri-food products in Romania will be capped. A huge stupidity that affects supply, affects investments in the sector and will add a minus of competitiveness to imports from the single market. It hits fixedly in Romanians, fixedly in Romania. Both in those who produce Romanian, and in those who consume Romanian. I give an example of pork: today, out of 9 kilograms of pork consumed by one person, 1 kilogram is local pork and 8 kilograms is imported meat. A few months ago, before the cap, the ratio was 3 kilograms to 6 kilograms per person (about 30%). This is the effect of the "sovereign" ceiling".