How can prices of products change in Russia?

How can prices of products change in Russia?

Today Russian media has reported about the upcoming price hikes for products in shops of the country. 

Thus, Izvestia with reference to the group of companies Dixie, writes that a number of its suppliers intend to raise the prices for bread, vegetables, fruit, alcohol and household chemicals by 10%. The trading network Auchan noted the same tendency, but it mentioned household chemicals and bakery products.

In its turn, Kommersant reported about the intention of suppliers to reduce the term of agreement of purchase prices with retailers from the standard 45 days to two weeks.

In an interview with Vestnik Kavkaza, Academician, member of the Academic Council RANHiGS, PhD Elmira Krylatykh expressed her viewpoint that in the present situation this measure is inevitable. "I am afraid that we cannot do anything, because you can see what the problem is."

The rise in prices is explained by inflation. "If inflation rises, prices cannot stay the same. It was hoped that a good harvest period in August and September could positively influence the current situation."

With regard to the level of a possible rise in prices, it is difficult to predict anything. ‘‘Most likely, prices will increase for dairy products, I think. As for a reduction or stabilization of prices, I hope this will influence vegetables and some fruit. Maybe we can see something positive in respect of fish. But now it is very difficult to say. Everything will depend on August. 

It is not excluded that the reverse process could occur. "Products can become cheaper in a natural way in case of a good harvest this year. Of course, in that case they will be forced to cut prices. A lot of things depend on regional characteristics. In different regions the situation can be different,’’ Elmira Krylatykh concluded. 

The chief researcher at the Center for agricultural and food policy IPEA RANHiGS, Vasily Uzun, said that such statements of product suppliers shows that they are acting in collusion. In this regard, he expressed hope that the FAS will take all necessary measures in order to prevent such a scenario.