Italy is heading into its most expensive Christmas season in years, with sharp price increases across traditional festive sweets exposing wider pressure on food producers, retailers, and household budgets.
Data from the Consumer Training and Research Centre (CRC) shows that the average price of industrially produced pandoro and panettone is now 42% higher than in 2021, while chocolate-based Christmas products have risen by an average of 89%.
The increases are now clearly visible across Italian supermarkets, where the traditional Christmas cake has become a symbol of wider food inflation rather than seasonal indulgence.
Ingredient Costs Are No longer Being Absorbed
Most coverage has focused on cocoa prices, but the cost shock in 2025 runs deeper.
Global cocoa prices climbed above $10,000 per tonne, up from around $2,500 in 2021. Butter prices followed a similar trajectory, rising 83% year on year to more than $8,300 per tonne.
For bakeries and industrial producers, energy has become the third pressure point. Electricity costs for food manufacturers increased again in 2025, reducing the scope for producers to absorb rising input costs. As a result, price increases are now being passed directly to consumers during the peak Christmas trading period.
Retail Prices Reveal A widening Split
At shelf level, the price range for festive cakes has stretched sharply.
Across Italian supermarkets, own-brand panettone and pandoro typically start around €5.50, while premium branded products now reach €17 or more. Chocolate-filled variants and glazed desserts have recorded the steepest increases, with some products now priced at more than double their 2021 levels.
Nougat has followed a more moderate path. Traditional almond, pistachio, and hazelnut varieties are up just over 20%, while chocolate nougat has increased by more than 56%, reflecting its exposure to cocoa markets.
Shrinkflation Enters The Christmas Aisle
One development largely missing from competitor reporting is shrinkflation.
In 2025, several branded “1kg” panettone products have quietly shifted to 900g or even 750g formats, allowing brands to hold key price points below €10. While legal and clearly labelled, the change has not gone unnoticed by Italian shoppers, particularly as unit prices continue to rise.
Producers have also adjusted recipes. With cocoa at record levels, some mid-tier products now contain lower cocoa butter content, replaced by cheaper vegetable fats. Label-aware consumers are increasingly spotting these changes during festive shopping.
Regional Differences Are Emerging
Price inflation has not been uniform across Italy.
In northern regions such as Lombardy and Veneto, premium branded products have seen the sharpest increases, driven by higher logistics and energy costs. In contrast, parts of southern Italy have seen more stable pricing for traditional torrone, supported by strong local almond and hazelnut harvests in 2025.
This regional split is influencing assortment decisions, with retailers adapting ranges to local purchasing power and preferences.
Brands Still Dominate, Despite Pressure
Despite higher prices, branded products continue to dominate Christmas shopping.
Centromarca data shows that three out of four Italians still prioritise branded goods during the festive season. Quality and perceived value remain the key drivers, even as prices rise.
Brand loyalty is also holding firm. Around 70% of consumers say they would switch retailer rather than switch brand if their preferred product is unavailable, reinforcing the importance of range availability during peak trading weeks.
Retailers are increasingly relying on loyalty data and retail technology tools to manage promotions, stock availability, and pricing without resorting to heavy discounting that could erode margins.
Consumers Adapt Their Spending Habits
Household budgets, however, are under strain.
Four in ten Italian consumers plan to reduce spending on gifts and festive meals by up to 50% compared with last year. Many families are compensating by cutting restaurant visits and focusing spending on fewer, higher-quality food items consumed at home.
CRC data shows that supermarket own-brands have become a key coping mechanism. With own-label festive cakes priced well below branded equivalents, they remain the only realistic way for many households to keep Christmas dessert spending under control.
Outlook For 2026
Looking ahead, NIQ forecasts 2.6% value growth for Italy’s consumer goods market in 2026. Branded products are expected to retain a strong position, particularly in supermarkets and self-service formats.
However, the 2025 Christmas season highlights a clear shift. Price sensitivity, shrinkflation awareness, and regional purchasing differences are now shaping festive food retail in ways not seen before, turning a traditional celebration into a test case for Italy’s grocery market.
Editor’s Note: This article is based on publicly available data and reports from the Consumer Training and Research Centre (CRC), Centromarca, and NIQ, alongside widely reported commodity price trends for cocoa and dairy markets in 2024–2025. No assumptions or unpublished estimates have been added.
