A new round of feta price increases is expected to begin today, with prices on the Greek market estimated to reach as much as €16 per kilo. The increases are mainly attributed to lower sheep’s milk production, strong export demand and higher production costs.
The supply of sheep’s milk has fallen by around 7%-8%, a decline linked, among other factors, to animal diseases such as sheep pox. According to figures cited in the report, around 450,000 sheep have died or been culled over the past two years, reducing the supply of the raw material needed for feta production.
Higher feta prices could also prompt consumers to turn to other cheeses, such as white cheese, potentially driving up their prices as well.
At the same time, more than 70% of Greek feta production is exported. Strong export demand, combined with lower milk production, is reducing the amount available for the domestic market and putting further pressure on prices. The industry is effectively having to balance domestic demand with existing export agreements.
Production costs also remain high. Rising milk prices, combined with energy costs, are estimated to add at least €1.50 per kilo to the final price of feta.
Higher feta prices could also affect the broader cheese market. If more consumers turn to cheaper alternatives, such as other white cheeses, increased demand could put upward pressure on prices in those categories as well.
Source: New Money
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