Survey to see how much of the food in the stores is Hungarian

After the last survey in 2014, this year Nébih will reassess the share of domestic and foreign food products in stores. The investigation, which began in August, will cover tens of thousands of products and is expected to be completed by the end of the year.

Retail chains with the largest turnover in Hungary will be surveyed.

Thus, the current survey will be conducted in ten chain stores: Aldi, Auchan, CBA, Coop, Lidl, Metro, Penny Market, Real, Spar and Tesco, and it will cover only those product categories that Hungarian agriculture and the food industry can traditionally produce in sufficient quantities for the Hungarian population.

This means, for example, that exotic fruits, sea fish and other import products that are impossible to be produced in Hungary because of the climate and geography will not be included in the survey.

The survey focuses on fresh pork and poultry, meat products, dairy products, eggs, honey, fruit and vegetables, jams, pasta and canned food, all broken down to product groups.

Seventy percent Hungarian

According to Nébih, the study, whose results will be made publicly available, may provide an opportunity to compare the ratio of products of domestic origin available in retail outlets with the situation surveyed six years ago using the same methodology. On the basis of this, it can be determined in which product categories domestic suppliers have increased their share or lost positions in recent years.

These food market developments can provide feedback to policy making institutions, provide a more realistic picture for market participants, and can also be used as a reference in business negotiations and decisions.

The publication of the results of previous surveys, for example, was often followed by supplier and marketing programmes in which retail chains favoured Hungarian partners, Nébih added.

The 2014 survey found that the ratio of domestic and foreign food products was roughly 70-30 percent, and the situation is unlikely to have improved considerably since then.One of the basic reasons for this is the growing popularity of discount chains, which are primarily contracted to food and trade companies that produce large quantities of products and transport them over long distances. Therefore, it is no coincidence that there is a higher proportion of dominant foreign suppliers among their partners, which may lead to an increase in food import.

Due to the open economy, domestic players in the food industry do not consider it possible, even in the long run, to minimize food imports, but they believe that there is a chance that the share will improve to 80-20 percent.

As this ratio would also be acceptable for the majority of companies working in the sector, efforts have been made in the past to include it in formal regulations.

No Food Code on the agenda

A so called “food production chain code” was created in 2009, and it included a requirement that in the case of high priority domestic food products, the ratio of Hungarian –made products should reach a minimum of 80 percent on the primary and secondary shelves in retail outlets, in all periods when these products are being produced in significant quantities in Hungary.

However, it was a problem that the code could not enforce mandatory compliance with its regulations; some of its points were even challenged by the competition authority, so its implementation was finally removed from the agenda.

More than a decade has passed since the unsuccessful introduction of the code, but there is still a great deal of uncertainty today as to whether a specific ratio regarding food products can be published in any “official” document or in legislation.

Therefore, the government is apparently seeking other methods in the food market, such as periodical state-promoted (marketing) campaigns, which are clearly aimed at putting domestic goods in a better position, and can therefore also help to curb imports.

Recently, as a result of the coronavirus epidemic, a new project called "Choose Hungarian!" was launched, which encourages consumers to buy food products made in Hungary. Agriculture Minister István Nagy also emphasized in his statement about the new campaign that conscious decisions by consumers to buy Hungarian products can protect the economy and provide a livelihood for domestic market players.

According to the minister, the epidemic has already proved that food self-sufficiency will be more important than ever before, therefore promoting domestic food products will become an increasingly significant task in the future.

Limited Hungarian ownership in the food trade

At the same time, many people believe that market campaigns are not enough; breakthrough results could only be achieved if Hungarian ownership was more dominant in food companies and, of course, in the food trade. As Government Commissioner János Lázár recently put it:

if 80 percent of the food processing industry has Hungarian ownership, then we will be able to say that 80 percent of the food consumed will be of Hungarian origin.

Industry estimates, on the other hand, show that the situation is much worse today in terms of ownership, as the domestic and foreign capital ratio can be 50-50 percent if the whole domestic food industry is taken into account.

Recent experience shows that for some firms, changes can occur in both directions, but in general, the current structure appears to be stable.

Based on this, there is no realistic chance today that Hungarian ownership in the domestic food industry could spectacularly advance in the foreseeable future.