Food prices in Cyprus have been increasing faster than the overall cost of living in recent months, prompting economists and consumer groups to call for closer scrutiny of the factors driving the widening gap.
The rising cost of living has affected Cyprus and the rest of Europe for several years, with the geopolitical crisis placing further pressure on inflation and household expenses.
According to figures released by the Statistical Service on Thursday, headline inflation in Cyprus reached 3.1% in June. Prices for food and non-alcoholic beverages rose by 5.1%, the fourth-largest increase among the main categories of goods and services.
Higher increases were recorded in transport, at 8.3%, housing, water, electricity, gas and other fuels, at 5.6%, and recreation, sport and culture, at 5.25%.
What is driving the increases
A recent article by Trojan Economics director Panayiotis Agisilaou, who specialises in competition issues, and associate Stavros Efthymiou examined the rising cost of food in Cyprus.
“In the second half of 2024, food prices increased faster than headline inflation, while the difference between the two indicators narrowed during 2025. This picture changed in the first four months of 2026, when the gap re-emerged and food prices once again recorded a higher rate of increase than the overall price index,” they wrote.
Higher food prices often force households to cut spending in other areas, they said, with the impact falling disproportionately on lower-income families, which spend a larger share of their budgets on essential needs.
The key question, they added, is which factors are shaping the trajectory of food prices.
The first is cost. International agricultural commodity prices, energy costs, transport expenses, climatic conditions and supply-chain disruption caused by geopolitical developments all directly affect food production and distribution costs.
The structure of the market is equally important.
“The intensity of competition, the level of market concentration, the distribution of bargaining power between businesses and barriers to entry affect how prices are set and the extent to which cost changes are passed on to the final consumer,” they said.
Several European competition authorities, including the Hellenic Competition Commission, the Italian Competition Authority and the Netherlands Authority for Consumers and Markets, have systematically examined food markets and the wider supply chain in recent years.
“Effective competition can neither prevent international price increases nor eliminate external cost pressures. It can, however, ensure that consumers benefit as much as possible from market forces and receive the best prices permitted by prevailing economic conditions,” the economists said.
Cyprus ‘did not do enough’
Speaking on Politis radio’s Morning Review programme with Katerina Eliadi, Cyprus Consumers Association president Marios Drousiotis said Cyprus had failed to take sufficient action to contain prices.
He contrasted the Cypriot response with measures introduced in Greece, where a cap on gross profit margins was imposed from March 1 for four months across a broad range of about 2,000 products.
Drousiotis said the Greek measure had delivered genuine price reductions for the products it covered. Once the cap expires, prices will be frozen for July and August, while the authorities will review in September whether further reductions can be achieved.
Dairy prices in Greece fell by between 5% and 6% over the four-month period, while in Cyprus they rose by 4.6% between March 1 and the end of June, he said.
Bakery product prices declined by between 4% and 6% in Greece but increased by 12% in Cyprus. Juice prices, which account for most of the non-alcoholic beverage category, fell by between 5% and 6% in Greece but rose by 6.17% in Cyprus.
Drousiotis also criticised what he described as inaction in enforcing existing Cypriot legislation.
What the Consumer Protection Service says
Consumer Protection Service director Konstantinos Karagiorgis told Politis that the service may intervene by setting maximum prices where this is permitted by law.
The existing legal framework allows maximum prices to be imposed on specific products in exceptional circumstances and under strict conditions. However, he stressed that such intervention was reserved for exceptional cases and was not standard practice in a free market, where prices were determined by supply and demand.
Karagiorgis said the cap on bottled water prices remained in force at locations where competition did not operate effectively.
In cooperation with the Finance Ministry, the authorities had also extended the reduction in excise duty on fuel, while zero VAT rates continued to apply to essential products.
He said the service was making a continuous effort to provide consumers with better information through its monthly Essential Consumer Goods Price Observatory and available price-comparison tools.
Consumers ultimately had to use those tools to identify the most economical choices within their budgets, he added.
Karagiorgis highlighted e-Kalathi and the online fuel-price comparison platform, which allows motorists to locate the lowest prices available at petrol stations.
He also pointed to significant differences in the prices of comparable products between supermarkets, making market research increasingly important before purchases were made.
“The informed and prepared consumer is the strongest consumer. Use the price-comparison tools provided by the service, compare your options and make purchases that reflect your needs and financial means,” he said.
“With proper information and planning, every household can save significant amounts.”
When competition authorities intervene
Politis also contacted the Commission for the Protection of Competition, whose chair, Eva Pantzari, said the authority could intervene where abuse of a dominant market position was identified or there were indications of cartel activity.
The commission may also launch sector-wide investigations when necessary, as it has previously done in the fuel and milk markets.
Price observatory records widespread increases
According to the Consumer Protection Service’s latest consumer goods price observatory for May, 36 of the 45 categories of essential products recorded increases compared with April 2026, while only nine registered declines.
The data were collected from 400 retail stores across Cyprus.
The largest monthly increase was recorded in processed meat products, which rose by 6.4% and were 9.2% more expensive than in May 2025.
Frozen breaded and precooked fish increased by 6.3% from April, although prices remained 15.3% lower than a year earlier.
Frozen molluscs and shellfish rose by 6.1% month on month but were 10.9% cheaper than in May 2025. Oil prices increased by 5.8% but were 0.2% lower annually, while canned meat rose by 5.4% from April and 7.3% from the previous year.
Further increases were recorded in Cyprus coffee, up 5.1% monthly and 5.8% annually, baby food, up 5.1% monthly and 10.9% annually, eggs, up 5% monthly and 7.9% annually, and flour, up 4.9% monthly and 3.5% annually.
What supermarkets say
Andreas Hadjiadamou, executive secretary of the Pancyprian Supermarkets Association, attributed the sharper increase in food prices compared with headline inflation to external pressures arising from the crisis.
“We hope that, as the situation normalises, prices will initially stabilise and that reductions may follow if conditions permit,” he told Politis.
He argued that strong competition between supermarkets was helping to contain increases and that prices would have risen even further without it.
Marios Antoniou, secretary-general of the Pancyprian Retail Trade Association, said inflation in Cyprus was rising faster than in the rest of Europe and was affecting consumption, with shoppers increasingly restricting their purchases to essential goods.
“Unfortunately, we are not self-sufficient. Almost everything is imported, so we are trapped by increases in freight charges, insurance premiums and transport costs,” he said.
Retailers were trying to offer consumers cheaper alternatives through private-label products, he added, arguing that conditions would be worse without intense competition in the market.
How Cyprus compares with the EU
According to Eurostat figures for May 2026, the latest available data by country, food prices in the EU rose by 1.5% annually based on the Harmonised Index of Consumer Prices.
This compared with an annual increase of 2.1% in April 2026 and 3.1% in June 2025.
In Cyprus, food price inflation stood at 2.9% in May, down from 5.1% in April. In June 2025, prices had recorded a marginal annual decline of 0.2%.
Cyprus nevertheless continued to record one of the highest annual increases in the EU.
Larger increases were registered in Romania, at 6.3%, Bulgaria, at 4%, Portugal, at 3.4%, and Greece, at 3.3%.
Food prices fell in eight EU countries, with the largest decline recorded in Sweden, at 5.6%, followed by Czechia, at 2%.
