Food prices in Malta are inflating at a higher rate than in the euro area, new figures published by the Central Bank of Malta show. 

In their latest report on the outlook for the Maltese economy, the CBM outlined how the price of food in Malta ballooned in response to pressure on international food prices and compounded by transportation costs. 

According to the report, the contribution of food prices to overall inflation rose from 0.2 percentage point in April 2021 to 1.6 percentage points a year later. As of last April, food inflation in Malta stood at 1.2 percentage points higher than that in the euro area.

“Malta imports around 70% of its food products and is therefore particularly susceptible to developments in international food prices and other commodity prices that affect food production as well as transport costs,” the CBM said. 

Which foods are rising in price?

The Central Bank analysis looked at the prices of a variety of staple foods, from cereals to imported meat and even animal feed.

A global index that tracks the international prices of meat, dairy, cereals, oils and sugar, the Food and Agricultural Organisation Food Price Index, was up 29.8% in April when compared to a year prior.

Much of that increase was driven by the rising prices of oil (up 46.5% globally) and cereals (up 34.3%).

Analysts at the Central Bank then looked at trade data of prices of importing food to Malta and calculated the rate of inflation for them between January and April.

The prices of fruit (13.3%) and vegetables (19%) rose the most significantly during that period, though the analysis found that inflation impacted other foodstuffs too. Bread and cereal prices were up by 9%, with meat prices rising by 5% in the first four months of the year.

Increased bread and cereal prices reflected a January price hike and were the result of rising international prices and global supply bottlenecks, it noted.

“As Malta is a small and open economy, local producers depend on foreign markets and are thus sensitive to changes in prices of food commodities as well as animal feed,” they said. 

Fruit and vegetable prices were impacted by local weather conditions as well as increased transport costs and higher farming costs through the rise of fertilizer costs.

But the worst may be behind us. The analysis predicted that annual food price inflation would peak at 7.6% in May and drop to 7.1% by the end of the year. By the second half of 2024, it is expected to have dropped to 2.3%.