More expensive food can lead to more Swedish trade. DNB believes in a record year in 2023.
Now Norwegians are flocking to Sweden to shop again. Increased food prices may lead to even more people traveling across the border, DNB believes.
– It has increased significantly in Swedish trade in the second quarter of 2022. The latest figures show that we are almost back to normal levels, says Ine Oftedahl, director of data transformation at DNB.
In March this year, Norwegians bought goods worth 710 million kroner in Sweden, divided into 423,000 day trips, figures from DNB show over Norwegians’ card use in Sweden.
Thus, the number of trips and turnover is on its way back to old heights – and maybe more.
In 2019, which was a record year for cross-border trade, Norwegians made 527,000 day trips in Sweden in March and spent a total of DKK 760 million.
At the same time, the figures for the first four months of the year show that Norwegians have so far this year been on 1.2 million day trips to Sweden.
In total, goods were traded for just over 2 billion kroner, which corresponds to 1700 kroner per. day trip.
It is much higher than last year when Norwegians from January to April went on 66,000 day trips and left 60 million kroner.
Tempted by alcohol and tobacco
NHO believes the figures from DNB are as expected.
– We have always assumed that cross-border trade would pick up after the pandemic, all the time the Norwegian authorities have not anticipated anything to curb the most important incentives, says NHO director of food and drink, Petter Brubakk, to Aftenposten.
On 1 January this year, it became more expensive to buy both alcohol and tobacco in this country.
– Statistics Norway took a deep dive into cross-border trade in 2019, which showed that more than half of the shopping baskets were filled with heavily taxed goods. Now the taxes on soft drinks and sugar have been removed, but it is still the case that a third of the goods traded are alcohol and tobacco, says Brubakk.
Believes Norway must look to Denmark
NHO recommends that the Norwegian authorities look to Denmark.
There they have analyzed people’s cross-border trade and adjusted the tax levels to get the customer back to Denmark. Increased electricity prices and the war in Ukraine will lead to higher food prices in all countries, but it is important that we young special Norwegian cost increases.
The corona pandemic and strict entry restrictions caused cross-border trade to plummet in 2020 and the first part of 2021. This led to a jump in turnover for Norwegian grocery stores and for Vinmonopolet.
– And this showed exactly how much Norway has to gain from the customer not disappearing to Sweden, Brubakk believes.
– 2023 could be a record year
Average amount per day trip increased from 1400 kroner in 2019 to 1700 kroner in 2021, according to DNB. That is an increase of 21.5 percent.
Recently, food prices in Norway and elsewhere in the world have risen sharply.
At the same time, food producers have warned that the war in Ukraine and increased electricity prices will lead to them having to raise food prices even more in the coming time.
Well, Ine Oftedahl in DNB believes that the price increase can make more Norwegians take the trip across the border this year and next year.
– On the basis of inflation in food prices, which affects both Norway and Sweden, DNB believes that in the future we can see results where customers feel it pays off to a greater extent with a trip across the border, without it necessarily being more to spare parts. This could lead to a record year in cross-border trade in 2023, she says.