Spain's leading supermarket chain, Mercadona, will lower the prices of at least 500 basic food products, it said on Wednesday, amid a cost of living crisis that had prompted the government to seek concessions from retailers.
The announcement comes a few weeks after Mercadona president and majority owner Juan Roig said his company, whose market share is nearly 26%, had had to raise prices "by a huge amount" to maintain margins through the food production chain.
Input Costs Easing
The company said in a statement on Wednesday that after seeing that input costs were slowly easing, it decided to make price cuts that it expects will save €150 on average for customers this year.
The cheaper products include fresh fish, some cheeses and yoghurts, dried fruit, oil and household cleaning products, it said.
French supermarket chain Carrefour launched a campaign in September offering consumers a basket of 30 basic goods for €30, after Labour Minister Yolanda Diaz said she was seeking agreements with supermarkets to help impoverished families continue to eat healthily.
Although her proposal was met with scepticism from business groups and opposition politicians who viewed it as an attempt to regulate prices, Basque Country-based cooperative Eroski followed suit in March, lowering the prices of basic food products.
Food prices have been climbing sharply throughout the European Union.
In Spain, they registered a 16.6% year-on-year increase in February, and experts believe that food inflation has yet to peak.