Further fall in producer prices for agricultural products in Germany

Agricultural product prices in Germany take a dive for the seventh straight month

Farmers in Germany are feeling the pinch as producer prices for agricultural goods have dropped for the seventh consecutive month. According to data released by the Federal Statistical Office in Wiesbaden on Thursday, farmers received an average of 14.5% less for their produce compared to the same month last year in October.

The main culprit behind this downward trend is a base effect, as prices had surged dramatically due to geopolitical tensions in 2022. Compared to the previous month of September, a drop of 1.7% was recorded.

The decrease in agricultural product prices is affecting other commodities as well, as producer prices for various goods in Germany declined in October. This trend of falling prices has persisted for seven consecutive months.

Additional Insights

While the article does not directly provide detailed information on the specific reasons for the seven-month decline in agricultural product prices, enrichment data reveals some relevant factors that might have contributed to this trend:

1. Overall Producer Price Trends: German producer prices have shown a mixed trend, with an increase of 0.5% in January 2025, which is lower than the expected 1.3% rise[1][4].
2. Energy Prices: Energy prices had a significant impact on overall producer prices. In January 2025, energy prices dropped by 1%, mainly due to natural gas, electricity, and district heating prices falling, while mineral oil product prices increased[1][4].
3. Capital Goods and Consumer Goods: Capital goods costs advanced by 1.9% in January, with higher machinery, motor vehicles, and semi-trailers costs. Non-durable consumer goods prices increased by 3%, while durable consumer goods prices inched up by 1.1%[1][4].
4. Food Prices: Food consumer prices in Germany have shown varying trends. For example, consumer prices for fruit increased by around 6.4% in 2024 compared to the previous year[2].
5. Factory Activity and Orders: German factory orders surged in December 2024, but industrial production declined by -2.4% month-on-month in December 2024, mainly due to reduced output from the automotive sector and machine maintenance and assembly[3].

Sources

• [1] Eurostat, "German Producer Prices, January 2025."
• [2] Deutsche Wirtschafts Nachrichten, "Fritte als Teuerste Lebensmittel: Warenpreise steigen im Januar 2024 um 2,6%."
• [3] Deutsche Welle, "German Factory Orders Rebound in December."
• [4] German Central Bank, "Consumer price index in Germany, January 2025."