“Populism, not solutions” – Latvian grocery chain Elvi leadership criticizes politicians for superficial approach to food prices

The issue of food prices is a topic that’s easy to speak loudly about, but policymakers fail to address it in a meaningful way, said “Elvi Latvija” board member Laila Vārtukapteine in an interview.

“If we’re talking about the current wave of populism coming from the political sphere and the Ministry of Economics, it’s no secret that someone always needs to be blamed—and currently, it’s the retailers. Unfortunately, this isn’t new; it’s been this way for years,” Vārtukapteine said.

She rejected accusations that Latvian-made products are marked up higher than imported goods in stores. She explained that price differences are often due to production scale: in large markets like Poland, production costs are lower, which allows for lower prices.

Vārtukapteine also emphasized that the discussions overlook on the difference between Latvian producers and distributors or intermediaries, including the fact that at the beginning of the year a large number of distributors received price increases for the brands they represent on the Latvian market—some by as much as 50%.

“Paradoxically, small local producers—like small bakeries or meat-smoking businesses—raised prices by only around 5%, while large distributors increased them up to 50%. That’s a completely different situation, so we can’t just lump everything together,” she said.

She added that Elvi has good relationships with small Latvian producers, especially regional ones who only sell within their local area.

“We’re still a relatively small company with around a 5% market share. If a large supplier who controls 50% of the market in Latvia approaches us, who is really in a dominant position? We can only listen to their demands and essentially have to agree to everything. These power dynamics are never really discussed,” Vārtukapteine stated.

She criticized the government’s proposed Unfair Trading Practices Prohibition Law, currently under review in the Saeima, saying that it protects only one side—producers.

Vārtukapteine warned that if the law is passed in its current form, retailers may stop working with smaller suppliers to avoid potential legal risks.

“Any law that threatens one side with huge fines is concerning. We’ll have to think very carefully about how to proceed. This kind of environment is never healthy and won’t foster strong cooperation, especially if we’re constantly afraid,” she said.

As reported, the government has approved the Ministry of Economics’ draft law aimed at ensuring fair competition in the food retail market and balancing relationships when economically stronger buyers exploit their position at the expense of suppliers.

The Ministry states that the proposed regulations would prevent buyers from applying significantly different trading terms—like markups—to one supplier’s products versus similar goods from others in comparable transactions.

Additionally, the list of unfair trading practices has been expanded with proposals from the Ministry of Agriculture. These include defining supply forecasts and banning unilateral sanctions, while clarifying when such measures are permitted.

The law also proposes eliminating the option for food retailers to negotiate extended payment terms (beyond 20 days) with producers or cooperatives for fresh vegetables and berries delivered at least three times per week.

Violations of the new law would allow the Competition Council to fine buyers or non-food retailers up to 4% of their annual net turnover, but not less than 700 euros. These penalties are set to take effect on the 1st of July 2026, pending final approval by the Saeima.

“Elvi Latvija” had a turnover of 5.48 million euros in 2023—an increase of 5% from the previous year. The company earned a profit of 116 300 euros, up 6.7% year-over-year. Elvi operates as a franchisor, with most of its partner stores located in regional parts of Latvia.

The company was founded in 2010 with a share capital of 1 002 820 euros. “Elvi Latvija” is owned by SIA Fortis VM (66.88%), Imants Rendenieks (33.05%), and SIA Realto Capital (0.07%), which is solely owned by Alvis Krasovskis.